DIRECTV (1.4%) (DTV - $59.75 - NASDAQ)(DTV) is the largest pay television provider in the world, with nearly twenty million subscribers in the United States and eight million subscribers throughout Latin America. Originally part of General Motors, DTV used its technological advantage, focus on high income customers, recognition of the necessity for superior customer service, and clever (Sunday Ticket) participation in exclusive sports programming to cement its position in the U.S. The company used essentially the same strategy in Latin America, where it is benefiting from the growth of the middle class in countries such as Brazil and Colombia. Atop a superior operating business, DTV has layered a capital structure that maximizes equity returns. The company has used modest leverage to repurchase stock, in the process cutting its shares outstanding by more than half over the last six years.
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From Mario Gabelli (Trades, Portfolio)'s third quarter 2013 commentary.
