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An Underrated Dividend Stock With 40 Years Of Dividend Hikes

|Includes: Leggett & Platt Inc. (LEG)

Leggett (NYSE:LEG) offers an impressive 3.6% dividend yield. It has increased its dividend every year for 41 years. This diversified company has proven to be somewhat resilient against the broader economy. It only has three analysts following the stock. Compare that to the fact that Procter & Gamble has 19 analysts following the stock.

Just over half of its revenues are generated via the residential furniture segment. It also makes industrial materials, commercial fixtures, and wire components. It's been quietly turning itself around after trading at close to $10 a share back in 2009. It has been divesting underperforming businesses. It now has a long-term plan to grow revenues by 4% to 5% annually over the long-term.

Shares are now trading at over $30 a share, but still represent a compelling opportunity. Leggett trades at a P/E ratio of 17 based on next year's earnings estimates. Tempur Pedic trades at a forward P/E ratio of 16 and La-Z-Boy at 17.2. Tempur Pedic doesn't pay a dividend, but La-Z-Boy pays a dividend that yields 0.95%.

Leggett has a 1.15 beta. That's the lowest beta of the three. Tempur Pedic has a beta 1.74. La-Z-Boy's is 2.3. This means that Leggett is less volatile than the other two.

Strong stocks paying dividends are hard to come buy. Leggett is one of those, after having paid dividends for over forty years. For investors looking a great dividend play and exposure to the furniture industry, Leggett is worth a closer look.