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STOCK-BASED COMPENSATION (Tables) | 12 Months Ended
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Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
Schedule of pre-tax compensation expense and the related income tax benefit for these stock-based incentives | Pre-tax compensation expense and the related income tax benefit for these stock-based incentives were as follows, in millions:
| 2016 |  | 2015 |  | 2014
Long-term stock awards | $ | 23 |  |  | $ | 23 |  |  | $ | 33 |
Stock options | 2 |  |  | 5 |  |  | 4 |
Phantom stock awards and stock appreciation rights | 4 |  |  | 11 |  |  | 6 |
Total | $ | 29 |  |  | $ | 39 |  |  | $ | 43 |
Income tax benefit (37 percent tax rate) | $ | 11 |  |  | $ | 14 |  |  | $ | 16 |
Schedule of the Company's long-term stock award activity | Our long-term stock award activity was as follows, shares in millions:
| 2016 |  | 2015 |  | 2014
Unvested stock award shares at January 1 | 5 |  |  | 6 |  |  | 8 |
Weighted average grant date fair value | $ | 17 |  |  | $ | 18 |  |  | $ | 17 |
Stock award shares granted | 1 |  |  | 1 |  |  | 1 |
Weighted average grant date fair value | $ | 26 |  |  | $ | 26 |  |  | $ | 22 |
Stock award shares vested | 2 |  |  | 2 |  |  | 2 |
Weighted average grant date fair value | $ | 16 |  |  | $ | 17 |  |  | $ | 17 |
Stock award shares forfeited | — |  |  | — |  |  | 1 |
Weighted average grant date fair value | $ | 20 |  |  | $ | 18 |  |  | $ | 19 |
Forfeitures upon spin off (A) | — |  |  | 1 |  |  | — |
Weighted average grant date fair value | $ | — |  |  | $ | 20 |  |  | $ | — |
Modification upon spin off (B) | — |  |  | 1 |  |  | — |
Unvested stock award shares at December 31 | 4 |  |  | 5 |  |  | 6 |
Weighted average grant date fair value | $ | 20 |  |  | $ | 17 |  |  | $ | 18 |
(A) | In connection with the spin off of TopBuild, TopBuild employees forfeited their outstanding Masco equity awards.
(B) | Subsequent to the separation of TopBuild, we modified our outstanding equity awards to employees and non-employee Directors such that all individuals received an equivalent fair value both before and after the separation. The modification to the outstanding stock awards was made pursuant to existing anti-dilution provisions in our 2014 Plan and 2005 Long Term Incentive Plan.
Schedule of the Company's stock option activity | Our stock option activity was as follows, shares in millions:
| 2016 |  | 2015 |  | 2014
Option shares outstanding, January 1 | 12 |  |  | 18 |  |  | 24 |
Weighted average exercise price | $ | 17 |  |  | $ | 21 |  |  | $ | 22 |
Option shares granted | — |  |  | — |  |  | — |
Weighted average exercise price | $ | 26 |  |  | $ | 26 |  |  | $ | 22 |
Option shares exercised | 5 |  |  | 5 |  |  | 2 |
Aggregate intrinsic value on date of exercise (A) | $ | 64 | million |  | $ | 50 | million |  | $ | 22 | million
Weighted average exercise price | $ | 21 |  |  | $ | 17 |  |  | $ | 16 |
Option shares forfeited | — |  |  | 3 |  |  | 4 |
Weighted average exercise price | $ | — |  |  | $ | 29 |  |  | $ | 28 |
Forfeitures upon spin off (B) | — |  |  | — |  |  | — |
Weighted average exercise price | $ | — |  |  | $ | 19 |  |  | $ | — |
Modifications upon spin off (C) | — |  |  | 2 |  |  | — |
Option shares outstanding, December 31 | 7 |  |  | 12 |  |  | 18 |
Weighted average exercise price | $ | 15 |  |  | $ | 17 |  |  | $ | 21 |
Weighted average remaining option term (in years) | 4 |  | 3 |  | 4
Option shares vested and expected to vest, December 31 | 7 |  |  | 12 |  |  | 18 |
Weighted average exercise price | $ | 15 |  |  | $ | 17 |  |  | $ | 21 |
Aggregate intrinsic value (A) | $ | 118 | million |  | $ | 133 | million |  | $ | 110 | million
Weighted average remaining option term (in years) | 4 |  | 3 |  | 4
Option shares exercisable (vested), December 31 | 6 |  |  | 10 |  |  | 15 |
Weighted average exercise price | $ | 13 |  |  | $ | 18 |  |  | $ | 22 |
Aggregate intrinsic value (A) | $ | 102 | million |  | $ | 113 | million |  | $ | 84 | million
Weighted average remaining option term (in years) | 3 |  | 3 |  | 3
(A) | Aggregate intrinsic value is calculated using our stock price at each respective date, less the exercise price (grant date price) multiplied by the number of shares.
(B) | In connection with the spin off of TopBuild, TopBuild employees forfeited their outstanding Masco equity awards.
(C) | Subsequent to the separation of TopBuild, we modified our outstanding equity awards to employees and non-employee Directors such that all individuals received an equivalent fair value both before and after the separation. The modification to the outstanding options was made pursuant to existing anti-dilution provisions in our 2014 Plan and 2005 Long Term Incentive Plan.
Schedule of weighted average grant date fair value of option shares granted and the assumptions used to estimate those values using a Black-Scholes option pricing model | The weighted average grant date fair value of option shares granted and the assumptions used to estimate those values using a Black-Scholes option pricing model were as follows:
| 2016 |  | 2015 |  | 2014
Weighted average grant date fair value | $ | 6.43 |  |  | $ | 9.67 |  |  | $ | 9.53 |
Risk-free interest rate | 1.41 | % |  | 1.75 | % |  | 1.91 | %
Dividend yield | 1.49 | % |  | 1.32 | % |  | 1.34 | %
Volatility factor | 29.00 | % |  | 42.00 | % |  | 49.00 | %
Expected option life | 6 years |  |  | 6 years |  |  | 6 years |
Summary of stock option shares outstanding and exercisable | The following table summarizes information for stock option shares outstanding and exercisable at December 31, 2016, shares in millions:
| Option Shares Outstanding |  | Option Shares Exercisable
| Range of Prices |  | Number of Shares |  | Weighted Average Remaining Option Term |  | Weighted Average Exercise Price |  | Number of Shares |  | Weighted Average Exercise Price
$ | 7 - 18 |  | 5 |  | 3 Years |  | $12 |  | 5 |  | $12
$ | 20 - 23 |  | 1 |  | 8 Years |  | $22 |  | — |  | $21
$ | 26 - 27 |  | 1 |  | 5 Years |  | $26 |  | 1 |  | $27
$ | 7 - 27 |  | 7 |  | 4 Years |  | $15 |  | 6 |  | $13
Schedule of phantom stock awards and SARs | Information related to phantom stock awards and SARs was as follows, in millions:
| Phantom Stock Awards |  | Stock Appreciation Rights
| At December 31, |  | At December 31,
| 2016 |  | 2015 |  | 2016 |  | 2015
Accrued compensation cost liability | $ | 10 |  |  | $ | 13 |  |  | $ | 8 |  |  | $ | 10 |
Unrecognized compensation cost | $ | 4 |  |  | $ | 4 |  |  | $ | — |  |  | $ | — |
Equivalent common shares | — |  |  | 1 |  |  | 1 |  |  | 1 |

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