There are still some firms that have been realizing gains in this economic environment and Chunghwa Telecom (NYSE: CHT) is one of them.             

While Washington debates its economic stimulus program, Beijing continues to step on the gas. Another $19 billion has just been unleashed on new infrastructure, housing and environmental projects. China has much more still to come. Adding to its financial shot in the arm, Beijing is revamping regulations and tax law to get money moving in the internal economy. 

Following a surprising success in a pilot program to get the appliance industry moving, Beijing is now dramatically expanding its rural appliance program. The program subsidizes farmers purchases of TVs, refrigerators, washing machines, microwave ovens and mobile phones.

Despite a decline of almost 6% in Taiwan’s GDP, Chunghwa, the nation’s largest phone company, delivered a gain to shareholders of almost 3% for the month. Part of the gain was due to Chunghwa’s announcement that it would begin expansion of a fiber optic network throughout the tiny island nation.

The company is also creating a new wireless enterprise with the cooperation of the government. Chunghwa has decided to invest $4 billion over the next five years to upgrade its fixed-line and mobile networks in order to enhance long term revenues. The company will build new fiber optic fixed-line networks and expand its mobile networks and undersea cables.

Chinese stock prices have been unfairly depressed in value, not because of their fundamentals, but because American markets remain unstable and an unreliable leader for economic decision-making. Chunghwa also retained its value by beating pro?t expectations for the full year 2008. The company reported self-estimated net pro?t of $1.37 billion for the year, exceeding its target by 4%. 

Chunghwa continues to prove itself as a source of reasonable growth and excellent dividend income. CHT continues to offer a hefty and reliable dividend yield. Chunghwa Telecom remains Taiwan’s most profitable telecom carrier. It enjoys a P/E multiple of 11, an attractive ?gure for an expanding telecom company. It has a dividend yield above 7%. CHT is a buy based on the growth potential and solid dividend, CHT has a 2 point gap up in early March I think this gap will get filled over the next 1-3 months. As CHT fills the gap down to $15.08, this will be a buying opportunity for the long term investor looking to add a quality growth stock which also offers a great dividend.

Disclosure: I do not own CHT