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Marketable Securities

3 Months Ended

Mar. 31, 2018

Marketable Securities [Abstract]

Marketable Securities

8.	Marketable Securities

The Financial Accounting Standards Board (“FASB”) ASC topic entitled Fair Value Measurements and Disclosures defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The accounting guidance classifies the inputs used to measure fair value into the following hierarchy:

Level 1

Unadjusted quoted prices in active markets for the identical asset or liability

Level 2

Observable inputs for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability

Level 3

Unobservable inputs for the asset or liability

The Company endeavors to utilize the best available information in measuring fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Valuation is based on prices obtained from an independent pricing vendor using both market and income approaches. The primary inputs to the valuation include quoted prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields, and credit spreads.

The method described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

Available-for-sale securities measured at fair value on a recurring basis are summarized below:

		Fair Value Measurements as of March 31, 2018
		Total				Level 1				Level 2				Level 3
U.S. Treasury securities		$	29,058			$	—			$	29,058			$	—
Agency securities			41,744				—				41,744				—
Mortgage-backed securities			158,839				—				158,839				—
Corporate securities			892,848				—				892,848				—
Municipal securities			185,586				—				185,586				—
Other			168,855				—				168,855				—
Total		$	1,476,930			$	—			$	1,476,930			$	—

		Fair Value Measurements as
		of December 30, 2017
		Total				Level 1				Level 2				Level 3
U.S. Treasury securities		$	19,337			$	—			$	19,337			$	—
Agency securities			43,361				—				43,361				—
Mortgage-backed securities			174,615				—				174,615				—
Corporate securities			816,793				—				816,793				—
Municipal securities			186,105				—				186,105				—
Other			181,509				—				181,509				—
Total		$	1,421,720			$	—			$	1,421,720			$	—

Marketable securities classified as available-for-sale securities are summarized below:

		Available-For-Sale Securities as of March 31, 2018


		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Fair Value
U.S. Treasury securities		$	29,439			$	—			$	(381	)		$	29,058
Agency securities			42,901				—				(1,156	)			41,745
Mortgage-backed securities			166,458				6				(7,625	)			158,839
Corporate securities			919,920				45				(27,117	)			892,848
Municipal securities			188,728				14				(3,157	)			185,585
Other			171,641				1				(2,787	)			168,855
Total		$	1,519,087			$	66			$	(42,223	)		$	1,476,930

		Available-For-Sale Securities as of December 30, 2017

		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Fair Value
U.S. Treasury securities		$	19,591			$	—			$	(254	)		$	19,337
Agency securities			44,191				1				(831	)			43,361
Mortgage-backed securities			180,470				13				(5,868	)			174,615
Corporate securities			830,447				136				(13,790	)			816,793
Municipal securities			187,999				110				(2,004	)			186,105
Other			183,730				2				(2,223	)			181,509
Total		$	1,446,428			$	262			$	(24,970	)		$	1,421,720

The Company’s investment policy targets low risk investments with the objective of minimizing the potential risk of principal loss. The fair value of our securities varies from period to period due to changes in interest rates, in the performance of the underlying collateral and in the credit performance of the underlying issuer, among other factors. The Company does not intend to sell the securities that have an unrealized loss shown in the table above, and it is not more likely than not that the Company will be required to sell a security before recovery of its amortized costs basis, which may be maturity.

The Company recognizes the credit component of other-than-temporary impairments of debt securities in “Other Income” and the noncredit component in “Other comprehensive income (loss)” for those securities that we do not intend to sell and for which it is not more likely than not that we will be required to sell before recovery. During fiscal 2017 and the 13-week period ended March 31, 2018, the Company did not record any material impairment charges on its outstanding securities.

The amortized cost and fair value of the securities at an unrealized loss position at March 31, 2018 were $1,466,270 and $1,424,047 respectively. Approximately 82% of securities in our portfolio were at an unrealized loss position at March 31, 2018. We have the ability to hold these securities until maturity or their value is recovered. We do not consider these unrealized losses to be other than temporary credit losses because there has been no material deterioration in credit quality and no change in the cash flows of the underlying securities. We do not intend to sell the securities and it is not more likely than not that we will be required to sell the securities; therefore, no material impairment has been recorded in the accompanying condensed consolidated statement of income.

The cost of securities sold is based on the specific identification method.

The following tables display additional information regarding gross unrealized losses and fair value by major security type for available-for-sale securities in an unrealized loss position as of March 31, 2018 and December 30, 2017.

		As of March 31, 2018
		Less than 12 Consecutive Months								12 Consecutive Months or Longer

		Gross Unrealized Losses				Fair Value				Gross Unrealized Losses				Fair Value
U.S. Treasury securities		$	(202	)		$	19,748			$	(179	)		$	6,319
Agency securities			(243	)			16,022				(913	)			25,723
Mortgage-backed securities			(711	)			17,631				(6,914	)			140,289
Corporate securities			(11,562	)			538,556				(15,555	)			341,137
Municipal securities			(1,786	)			139,591				(1,371	)			40,649
Other			(2,784	)			136,448				(3	)			1,934
Total		$	(17,288	)		$	867,996			$	(24,935	)		$	556,051

		As of December 30, 2017
		Less than 12 Consecutive Months								12 Consecutive Months or Longer

		Gross Unrealized Losses				Fair Value				Gross Unrealized Losses				Fair Value
U.S. Treasury securities		$	(111	)		$	12,966			$	(143	)		$	6,371
Agency securities			(168	)			16,097				(663	)			25,972
Mortgage-backed securities			(503	)			19,628				(5,365	)			153,835
Corporate securities			(4,562	)			439,174				(9,228	)			347,052
Municipal securities			(1,027	)			125,819				(977	)			38,167
Other			(2,219	)			136,147				(4	)			2,579
Total		$	(8,590	)		$	749,831			$	(16,380	)		$	573,976

The amortized cost and fair value of marketable securities at March 31, 2018, by maturity, are shown below.

		Amortized Cost				Fair Value

Due in one year or less		$	168,370			$	167,745
Due after one year through five years			1,175,500				1,143,859
Due after five years through ten years			160,650				151,195
Due after ten years			14,567				14,131
		$	1,519,087			$	1,476,930