Drip Portfolio Report
Tuesday, May 12, 1998
by Dale Wettlaufer (DaleW@fool.com)


Alexandria, VA (May 12, 1998) -- We continue to add banks to our list of potential investments. Today's little beauty is First Tennessee National Corp. (Nasdaq: FTEN). (Sorry to reveal a bias, but I do have one, though I don't own this company.) Compare the numbers, particularly the company's capital efficiency and productivity ratios, with some of the other companies we've introduced so far. First Tennessee is like a baby Norwest (NYSE: NOB) or Fifth Third Bancorp (Nasdaq: FITB). I believe it's one of the smaller stars in the industry.

(Financial numbers in millions except for per share numbers.)

Price/Valuation

Share Price.....$33 5/16
Market Cap.....$4,412.01
Price/Book.....4.51
Price/Tangible Book.....4.94
BVPS.....$7.38
Price/Assets.....27.75%
Price/Net Loans.....52.22%
Price/Deposits.....40.80%
Price/Tangible Assets.....27.90%
Price/Revenues.....3.67
P/E.....21.5
Amortization-Adjusted P/E.....21.0
Multiple on 1999 Est......17.7
EPS.....$1.55
Cash EPS.....$1.58
Diluted Sharecount.....132.44
1998 EPS Estimate.....$1.68
1999 EPS Estimate.....$1.88
Multiple on 1998 Est......19.8
Amort-Adjusted Multiple on 1999.....17.4

Capital Productivity/Efficiency

Asset Turnover2.....8.38%
Asset Turnover.....8.33%
ROE2.....23.07%
ROE.....22.56%
Amortization Adjusted ROE.....25.50%
ROA.....1.45%
ROA2.....1.462%
Net margin2.....17.46%
Net Margin.....17.08%
Efficiency Ratio.....69.13%
Interest Income/AEA.....7.78%
Interest Expense/AEA.....3.79%
Net Interest Margin.....3.99%
NIM/Tangible Assets.....3.97%
Net Share Buybacks.....$145.2 (estimated)
Dividends on Common.....$80.1
Retention Rate.....61.82%
Internal Capital Generation Rate.....15.76%
Payout Ratio on AAEarnings.....38.18%
Owners' Yield.....5.11% (estimated)

Balance Sheet

Cash & Nonearning Assets.....$2,723.6
Cash & Nonearning Last Year.....$1,788.8
Long Term Debt.....$366.6
Preferred Stock.....$0.0
Shareholder's Equity.....$977.6
Last Year Equity.....$841.9
Tangible Equity.....$892.9
Last Year Tangible Equity.....$753.1
Total Assets.....$15,897.6
Last Year Assets.....$12,975.5
Tangible Assets.....$15,812.8
Last Year Tangible Assets.....$12,886.8
Total Liabilities.....$14,919.9
Goodwill.....$84.8 (estimated)
Last Year's Goodwill.....$88.7
Average Earning Assets.....$12,180.3
Gross Loans.....$8,578.2
Loan Loss Reserves.....$130.03
Loan Loss Reserves %.....1.52%

Leverage

Equity/Assets.....6.30%
Equity/Assets (Tangible).....5.74%
Assets/Equity.....15.87
Assets/Equity (Tangible).....17.44
Loans to Deposits.....79.32%
LT Debt/Equity.....37.50%
Leveraged Capital Ratio.....6.39%
Tier 1 Capital Ratio.....7.83%
Total Risk Based Capital Ratio.....10.97%

Income Statement

Revenues.....$1,202.13
Interest Income (TTM).....$941.3
Interest Expense (TTM).....$458.2
Net Interest Income.....$483.1
Provision for Loan Losses.....$52.10
Provision/Interest income.....5.54%
Provision/Loans.....0.61%
Noninterest Income (TTM).....$719.0
Noninterest Expense (TTM).....$835.63
Net Income for Common (TTM).....$205.26
Amortization Adjusted Earnings.....$209.84
Noninterest income/revenues.....59.81%
Noninterest income/NII.....148.84%
Amort. Adjusted Net/Revs......17.46%
Amortization of Goodwill.....$4.58 (estimated)

Credit Quality

Charge Offs.....$56.00
Net Charge Offs.....$43.77
Credit Loss Provision/Charge Offs.....93.05%
Provision/Net Charge Offs.....119.05%
Nonperforming Loans.....$40.20
Nonperforming Assets.....$52.0
Nonperforming Assets Ratio.....0.61%
Reserves/Nonperforming Loans.....323.47%
Months Charge-Offs in Reserves.....27.9

Deposits

Deposits.....$10,814.8
Noninterest bearing deposits.....$2,773.0
Noninterest deposits/deposits.....25.64%
Core Deposit Percentage.....85.1%
Deposits/Liabilities.....72.49%

Risk-Based Capital Productivity

Leverage*Turns*Net Margin2.....1.22
ROE2*Tier1.....18.06

FoolWatch -- It's what's going on at the Fool today.


TODAY'S NUMBERS

*Please Note: due to a temporary glitch, the numbers are only partially available today. Complete numbers will be available again on Monday. Apologies for the delay!

Stock Close Change CPB $53 5/16 - 7/16 INTC $84 9/16 +2 1/16 JNJ $70 7/8 + 3/4
Day Month Year History Drip 1.51% 2.18% 10.82% (5.62%) S&P 500 0.83% 0.36% 14.98% 17.29% Nasdaq 0.65% (0.44%) 18.46% 16.71% Last Rec'd Total # Security In At Current 04/13/98 1.000 CPB $53.690 $53.250 04/01/98 9.015 INTC $80.417 $84.563 04/07/98 4.099 JNJ $68.952 $71.000 Last Rec'd Total# Security In At Value Change 04/13/98 1.000 CPB $53.69 $53.25 ($0.44) 04/01/98 9.015 INTC $724.94 $762.31 $37.37 04/07/98 4.099 JNJ $282.64 $291.03 $8.39 Base: $1500.00 Cash: $386.10** Total: $1492.69

The Drip Portfolio has been divided into 63.266 shares with an average purchase price of $23.710 per share.

The portfolio began with $500 on July 28, 1997, adds $100 on the 1st of every month, and the goal is to have $150,000 in stock by August of the year 2017.

**Transactions in progress:

04/22/98: Sent $30 to buy more INTC.
04/22/98: Sent $70 to buy more JNJ.