Income is a big part of investors' returns. Stocks, mutual funds and fixed income ideas in this column are featured because they are relatively solid in their ability to pay dividends or interest. We're giving income investors a resource to start their research for investments that give better yields with lower risk.

HPT is in a better place these days. It recently renegotiated leases with TravelCenters of America, Marriott and InterContinental Hotels Group. It had to be done. Lessees werent' getting enough revenues to meet their contractual obligations which meant that HPT couldn't determine its cash flows. With the new agreement, minimum rents were reduced by $47 million to $500 million a year. Now that management has that in the rear veiw mirror, it can look forward and start shopping for more hotels.

It recently put together a deal to buy Sonesta International Hotels Corp., paying $174 million in cash. The purchase should be complete by the end of March. Expect more acquisitions.

Earnings for 2011 should show $3.30 a share, up from $3.24 last year. For 2012, 6 analysts see $3.26. Revenues most likely finished at $1.18 billion in 2011. One analyst thinks 2012 will show $1.22 billion.

Income investors should focus on Funds From Operations (FFO). This is where dividends come from. While earnings can be hurt by non-cash items such as depreciation, FFO is strictly about cash coming in. For HPT, FFO increased by 5% to $2.52 a share for the first three quarters of 2011. The Average Daily Rate per room increased by 3% over 2010 to $93.60. Furthermore, occupancy rates also improved in the three quarters of 2011 by 3% over 2010 to about 74%. Revenue per available room for the nine months increased by 8% over 2010's first nine.

HPT's stock price has been in a narrow range since January of 2011, staying between $19 and $25 for most of that time. In the last four months, it moved up 13%, most likely from conclusion of the renegotiated lease agreements. Since earnings aren't expected to grow significantly over the next year, investors shouldn't expect much capital appreciation from HPT.

However, they should welcome the dividend. It's currently $1.80, giving a yield of 7.2%. In 2008, the payout was $3.08 a share. In 2009, it dropped to 77 cents, then rebounded to $1.80 in 2010. Expect change again this year, most likely for the better.

- Essential Numbers:
- Market Cap: $3.09 billion
- Forward P/E: 7.68
- Price to sales: 2.61
- Price to book: 1.27
- Operating margin: 29.32%
- Profit margin: 5.01%
- Return on equity: 2.03%
- Return on assets: 4.15%
- Total cash: $6.49 million
- Cash per share: 5 cents
- Total debt: $2.08 billion
- Debt to equity: 73.73%
- Current ratio: .92
- Book value per share: $19.69
- Beta: 1.32
- 52 week change: - 2.54%
- Shares outstanding: 123.52 million
- Float: 123.01 million
- Held by insiders: .41%
- Held by insitutions: 85.2%

Income investors will like the yield of HPT. And it seems fairly secure, as long as the economy continues to hold or improve. But if it slips into a double dip recession, expect HPT to feel the pinch, as it did in 2010 when business travelers kept travel to a minimum.