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.

The Commercial Fixturing and Components segment (15% of 2010 revenues) provides fixture and display products to retailers, marketers, and distributors of consumer products. It also produces seating components for office furniture manufacturers.

The Industrial Materials segment (20% of '10 sales) produces steel rod, drawn wire, steel billets, fabricated wire products (such as wire ties to bale cotton; shaped wire for automotive and medical supply applications; and tying heads, boxed wire, and parts for automatic baling equipment), coated wire products (including dishwasher racks), and wire retail fixtures and point-of-purchase displays. It also offers welded steel tubing and fabricated tube components.

The Specialized Products segment (17% of 2010 revenues) designs, produces, and sells various components used in automotive seating, including lumbar support and massage systems, seat suspension systems, and formed metal and wire components for seat frames, as well as automotive control cables (such as shift cables, cruise-control cables, seat belt cables, and accelerator cables) and low voltage motors.

It also designs and produces bedding industry machinery (including quilting machines for mattress covers and machines used to shape wire into various springs) and commercial vehicle products (including van interiors and docking stations that mount computers and other electronic equipment inside vehicles and specialty trailers). Leggett & Platt was founded in 1883 and is headquartered in Carthage, Missouri.

LEG had a tough year in 2009. Sales dropped by 25% ($4.076 billion to $3.055 billion). But earnings were up 1 cent to 74 cents. Dividends increased by 2 cents to $1.02. Management slashed costs to reflect lower revenues and delivered better profits and payouts to shareholders. Tough to do in this economy.

In 2010, sales picked up, went to $3.359 billion. Earnings jumped to $1.15. Dividends were raised to $1.06. For 2011, 5 analysts have a consensus opinion of $1.33 for earnings and $3.62 billion for revenues. Quarterly results will be out on October 27. Expect 36 cents vs 31 cents last year in the third period. For the final quarter, look for 30 cents, a better than 40% improvement over last year's 21 cents in the fourth.

Raw materials costs are going higher, steel for example. So management raised prices to compensate. They're sticking, even in a weak economy. Orders continue to rise from automobile manufacturers and office furniture makers. Residential housing products are sitting on shelves longer as the housing slump continues. If consumer confidence improves, look for more demand in all divisions.

The $1.12 dividend will take about 91% of current earnings for 2011. But next year, that should decrease to 66%. It will most likely go up 2 cents or more, as it has since 1995 (probably longer but that's the last data point I have). In some years, it advanced by 22 cents, as recently as 2008. Dividends are definitely a priority for management.

Essential numbers:
- Market Cap: $2.84 billion
- Trailing P/E: 17
- Forward P/E: 12
- Price to sales ratio: .80
- Price to book: 1.95
- Operating margin: 7.87%
- Profit margin: 5.09%
- Return on equity: 12.53%
- Return on assets: 5.59%
- Total cash: $203.3 million
- Cash per share: $1.44
- Total debt: $862.60 million
- Total debt/equity: .59
- Current ratio: 2.28
- Book Value: $10.14
- Beta: 1.33
- Change in last 52 weeks: - 16.8%
- Total shares Outstanding: 141.58 million
- Float: 138.47 million
- Insiders own: 11.53%
- Institutions have: 56.90%

Income investors will like the yield here and will find the stock's price activity comforting. In the last 2 years, the stock traded in a rather tight range, between $18 and $27. Now LEG is closer to the low end of that range with solid prospects, if global economies recover and grow. But if there's another recession, consumers will pull back again. And so will LEG.