Chunghwa is the dominant telco in Taiwan, size that gives the firm a considerable advantage over rivals. Telecom firms of all sizes essentially have to pay for the same networks -- so while revenues are a product of scale, costs aren't. By being the biggest, CHT can spread its costs over more accounts. The firm has been upgrading its network over the last few years, speeding up its wireless infrastructure as well as the fixed line network that serves CHT's internet customers, factors that should help keep customer attrition low.
The downside of scale, of course, is growth. To counter a slowing top line, the firm has been pushing into new businesses, such as enterprise networking. That should help to maintain the growth numbers that sparked investors' interest in CHT to begin with. A huge 5.75% dividend payout gives this stock ample appeal to income investors to boot.
Short sellers really hate Thompson Reuters (TRI). The financial data firm currently sports a short interest ratio of 38.3, the highest on our list today. At that level, it would take close to two months for shorts to completely exit their positions at current volume levels -- that makes TRI a stellar short-squeeze candidate.While Thomson Reuters may be best known for its news service, the firm's most significant business is actually its professional markets data platform, which licenses data to financial firms through pricey terminals. TRI is the number-two player in the terminal business, a lucrative niche that's dominated by the Bloomberg Terminal. Because investment professionals essentially commit to learning the proprietary commands of a system, they're less inclined to change once they've picked one. To counter growth challenges, TRI has been building out other professional analysis platforms, catering to quantitative investors with software packages that run upwards of five-figures a month. Financially, TRI is in strong shape, with a manageable net debt load and plenty of balance sheet liquidity. The firm's 4.7% dividend yield should act as a reminder that the firm generates more than $1.5 billion in free cash each year. If we see an equity rally resume in Q4, Thompson Reuters could benefit disproportionately.
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