Stockholders' Equity

12 Months Ended

Dec. 31, 2015

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Note 4. Stockholders’ Equity

Our authorized, issued, and outstanding shares (stated in whole numbers) at year end consisted of the following:

	Par Value	2015	2014
Preferred stock	$0.01/share
Shares authorized		5,000,000	5,000,000
Shares issued and outstanding		—	—
Common stock	$0.01/share
Shares authorized		400,000,000	400,000,000
Shares issued and outstanding		289,581,682	295,867,844

Dividends

On January 14, 2016, our board of directors declared a quarterly dividend of $0.30 per share of common stock to be paid in cash on February 26, 2016 to shareholders of record at the close of business on January 29, 2016. We paid aggregate annual dividends per share of $1.12, $1.00, and $0.80 in 2015, 2014, and 2013, respectively.

Stock Purchases

Subsequent to December 31, 2015, we have purchased 1,600,000 shares of our common stock at an average price of approximately $37.15 per share.

Stock Options

The following tables summarize the details of grants made under our stock option plan that are still outstanding, and the assumptions used to value these grants. All options granted were effective at the close of business on the date of grant.

	Options Granted	Option Exercise (Strike) Price		Closing Stock Price on Date of Grant		December 31, 2015
Date of Grant						Options Outstanding	Options Exercisable
April 21, 2015	893,220	$	42.00	$	41.26	817,990	—
April 22, 2014	955,000	$	56.00	$	50.53	797,500	5,000
April 16, 2013	205,000	$	54.00	$	49.25	125,000	2,500
April 17, 2012	1,235,000	$	54.00	$	49.01	1,039,500	341,250
April 19, 2011	410,000	$	35.00	$	31.78	250,300	150,300
April 20, 2010	530,000	$	30.00	$	27.13	210,350	120,350
April 21, 2009	790,000	$	27.00	$	17.61	293,100	200,600
April 15, 2008	550,000	$	27.00	$	24.35	147,750	122,750
April 17, 2007	4,380,000	$	22.50	$	20.15	849,492	849,492
Total	9,948,220					4,530,982	1,792,242

Date of Grant	Risk-free Interest Rate		Expected Life of Option in Years	Expected Dividend Yield		Expected Stock Volatility		Estimated Fair Value of Stock Option
April 21, 2015	1.3	%	5.00	2.7	%	26.84	%	$	7.35
April 22, 2014	1.8	%	5.00	2.0	%	28.55	%	$	9.57
April 16, 2013	0.7	%	5.00	1.6	%	37.42	%	$	12.66
April 17, 2012	0.9	%	5.00	1.4	%	39.25	%	$	13.69
April 19, 2011	2.1	%	5.00	1.6	%	39.33	%	$	11.20
April 20, 2010	2.6	%	5.00	1.5	%	39.10	%	$	8.14
April 21, 2009	1.9	%	5.00	1.0	%	38.80	%	$	3.64
April 15, 2008	2.7	%	5.00	1.0	%	30.93	%	$	7.75
April 17, 2007	4.6	%	4.85	1.0	%	31.59	%	$	5.63

All of the options in the tables above vest and become exercisable over a period of up to eight years. Generally, each option will terminate approximately nine years after the grant date.

The fair value of each share-based option is estimated on the date of grant using a Black-Scholes valuation method that uses the assumptions listed above. The risk-free interest rate is based on the U.S. Treasury rate over the expected life of the option at the time of grant. The expected life is the average length of time over which we expect the employee groups will exercise their options, which is based on historical experience with similar grants. The dividend yield is estimated over the expected life of the option based on our current dividend payout, historical dividends paid, and expected future cash dividends. Expected stock volatilities are based on the movement of our stock over the most recent historical period equivalent to the expected life of the option.

A summary of the activity under our stock option plan is as follows:

	Options Outstanding		Exercise Price(1)		Remaining Life(2)
Outstanding as of January 1, 2015	4,712,330		$	38.52	4.59
Granted	893,220		$	42.00	8.41
Exercised	(813,838	)	$	23.47
Cancelled/forfeited	(260,730	)	$	45.84
Outstanding as of December 31, 2015	4,530,982		$	41.49	4.89
Exercisable as of December 31, 2015	1,792,242		$	31.00	2.15

	Options Outstanding		Exercise Price(1)		Remaining Life(2)
Outstanding as of January 1, 2014	4,356,630		$	34.06	4.66
Granted	955,000		$	56.00	8.41
Exercised	(314,300	)	$	24.49
Cancelled/forfeited	(285,000	)	$	44.39
Outstanding as of December 31, 2014	4,712,330		$	38.52	4.59
Exercisable as of December 31, 2014	1,972,330		$	27.89	2.51

⁽¹⁾ Weighted average exercise price.

⁽²⁾ Weighted average remaining contractual life in years.

The total intrinsic value of stock options exercised during the years ended December 31, 2015, 2014, and 2013 was $14,174, $7,466, and $9,925, respectively. The intrinsic value represents the difference between the exercise price and fair value of the underlying shares at the date of exercise.

At December 31, 2015, there was $15,073 of total unrecognized stock-based compensation expense related to outstanding unvested stock options granted under the plan. This expense is expected to be recognized over a weighted average period of 4.60 years. Any future change in estimated forfeitures will impact this amount. The total grant date fair value of stock options vesting under our stock option plan during 2015, 2014, and 2013 was $5,143, $7,287, and $3,508, respectively.

Total stock-based compensation expense related to our stock option plan was $5,841, $7,039, and $5,400 for 2015, 2014, and 2013, respectively.

Earnings Per Share

The following tables present a reconciliation of the denominators used in the computation of basic and diluted earnings per share and a summary of the options to purchase shares of common stock which were excluded from the diluted earnings calculation because they were anti-dilutive:

Reconciliation	2015	2014	2013
Basic weighted average shares outstanding	291,453,107	296,490,378	296,754,160
Weighted shares assumed upon exercise of stock options	592,335	822,866	929,428
Diluted weighted average shares outstanding	292,045,442	297,313,244	297,683,588

Summary of Anti-dilutive Options Excluded	2015		2014	2013
Options to purchase shares of common stock	2,611,367		1,903,767	1,273,527
Weighted average exercise prices of options	$	51.89	54.67	54.00

Any dilutive impact summarized above related to periods when the average market price of our stock exceeded the exercise price of the potentially dilutive options then outstanding.