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Stock-Based Compensation | 3 Months Ended
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Mar. 31, 2024
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation | Stock-Based Compensation The Roper Technologies, Inc. 2021 Incentive Plan is a stock-based compensation plan used to grant incentive stock options, nonqualified stock options, restricted stock and restricted stock units (collectively “restricted stock awards”), stock appreciation rights, or equivalent instruments to Roper’s employees, officers, directors, and consultants. The following table provides information regarding the Company’s stock-based compensation expense:
|  |  | Three months ended March 31,
|  |  |  |  | 2024 |  | 2023
Stock-based compensation |  |  |  |  | $ | 33.6 |  |  | $ | 30.2 |
Tax benefit recognized in net earnings |  |  |  |  | 5.9 |  |  | 5.2 |
Stock Options – During the three months ended March 31, 2024, 0.244 options were granted with a weighted-average fair value of $173.78 per option. During the same three-month period in 2023, 0.353 options were granted with a weighted-average fair value of $128.89 per option. All options were issued with an exercise price equal to the closing price of Roper’s common stock on the date of grant, as required by the Company’s stock-based compensation plan. Roper records compensation expense for employee stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option pricing model. Historical data is used to estimate the expected price volatility, the expected dividend yield, and the expected option life. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected life of the option. The Company accounts for forfeitures of awards as they occur, with previously recognized compensation reversed in the period that the awards are forfeited. The following weighted average assumptions were used to estimate the fair value of options granted during the current and prior year periods using the Black-Scholes option pricing model:
| Three months ended March 31,
| 2024 |  | 2023
Risk-free interest rate (%) | 4.15 |  |  | 3.73 |
Expected option life (years) | 5.73 |  | 5.65
Expected volatility (%) | 25.57 |  |  | 26.02 |
Expected dividend yield (%) | 0.50 |  |  | 0.64 |
Cash received from option exercises for the three months ended March 31, 2024 and 2023 was $39.3 and $24.6, respectively. Restricted Stock Awards – During the three months ended March 31, 2024, the Company granted 0.337 shares of restricted stock awards with a weighted-average grant date fair value of $557.15 per share. During the same three-month period in 2023, the Company granted 0.219 shares of restricted stock awards with a weighted-average grant date fair value of $428.20 per share. These awards were granted at the fair market value of the share on the date of grant. During 2024, the Company revised its equity compensation strategy to more closely align long-term management incentives with its strategic objective to deliver and sustain higher levels of organic growth. Accordingly, the total number of restricted stock awards granted during the three months ended March 31, 2024 increased as compared to the three months ended March 31, 2023 due primarily to the adoption of a supplemental equity compensation program for the Company’s business unit leadership teams under which 0.120 incremental three-year performance-based restricted stock awards were granted. In connection with the revised compensation strategy noted above, certain members of the Roper senior leadership team were granted 0.072 performance-based restricted stock awards during the three months ended March 31, 2024, that include the ability to earn up to 200% of the number of restricted stock awards originally granted contingent upon Roper’s performance over a three-year period, subject to a market modifier based on relative total shareholder return. Comparably, during the three months ended March 31, 2023, 0.071 performance-based restricted stock awards were granted to certain members of Roper’s senior leadership team which did not contain a market modifier and do not have the ability to vest beyond 100% of the original shares granted. Due to the extent of performance required by the vesting conditions noted above, these awards are not expected to materially increase stock-based compensation expense relative to the Company’s financial performance. During the three months ended March 31, 2024, 0.100 restricted stock award shares vested with a weighted-average grant date fair value of $437.34 per share and a weighted-average vest date fair value of $556.38 per share. Employee Stock Purchase Plan – Roper’s employee stock purchase plan (“ESPP”) allows employees in the U.S. and Canada to designate up to 10% of eligible earnings to purchase Roper’s common stock at a 10% discount on the lower of the closing price of the stock on the first and last day of each quarterly offering period. Common stock sold to employees pursuant to the ESPP may be either treasury stock, stock purchased on the open market, or newly issued shares. During both the three months ended March 31, 2024 and 2023, participants in the ESPP purchased 0.012 shares of Roper’s common stock for total consideration of $5.8 and $4.7, respectively. All of these shares were purchased from Roper’s treasury shares.

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