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10 Best 'Dividend Aristocrats' for 2012

Stocks in this article: BFBHRLPPGSIALMMMBDXITWBCRNUELEG

1. Leggett & Platt

Liability Adjusted Cash Flow Yield: 8.04%

Dividend Yield: 5.08%

Return on Invested Capital: 22.65%

In the days spent writing this article (after the necessary research was performed to arrive at a list of 10 stocks), Leggett & Platt (LEG) shares have sunk far enough to show a negative return on the decade.

This fact should eliminate the stock from our list (keeping in the spirit of our third criterion, listed on the first page of this article). However, because the stock may, at any time, appreciate the few percentage points necessary to merit inclusion in this list, and because there is no other Dividend Aristocrat that satisfies four of our five criteria, we shall allow the company to remain.

Leggett & Platt is a diversified manufacturer whose claim: "Our Products Are All Around You," is a statement of fact, not puffery. The company's product offerings include carpeting found in large, common areas; bed springs; lumbar support within automobiles; and many other products that customers use without noticing.

The company is the highest-yielding stock on this list and also the cheapest. But this "bargain" comes with the caveat that for several years, Leggett & Platt has suffered from deteriorating revenue and income. In the past 12 months, these metrics have righted themselves (somewhat), but the market has valued this company as a business in decline.

The truth, as always, remains to be seen.

>>To see these stocks in action, visit the 10 Best 'Dividend Aristocrats' for 2012 portfolio on Stockpickr.

-- Written by John DeFeo in New York City

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
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