The total world furniture market is expected to grow at 5.2% annually between 2018 and 2023, according to Mordor Intelligence. This high growth rate continues a recent trend of the industry outperforming the overall U.S. economy since the 2008 financial crisis. Increased furniture buying by the sizable Millennial generation is one of the main factors driving growth. There is also increasing export business for U.S.-based furniture companies as global demand rises with the continuing development of emerging market economies in the Asia-Pacific region. Furniture companies are considered to have cyclical stocks for investment purposes.

Here are five of the best bets for furniture stocks in 2020.

1. La-Z-Boy Inc.

La-Z-Boy Inc. (LZB) is engaged in manufacturing, exporting, and retailing furniture products and accessories throughout the United States and worldwide. The Monroe, Michigan company is best-known for its various popular styles of reclining chairs, known colloquially as La-Z-Boys. Founded in 1927 and initially known as the La-Z-Boy Chair Company, the company changed names in 1996.

As of November 2019, La-Z-Boy had a market cap of $1.65 billion. The stock was trading at $35.41. It offered investors a dividend yield of 1.46%. La-Z-Boy has shown steady growth since the 2008 financial crisis. Its shares remained reasonably priced even as it hit record highs in 2019. Ultimately, La-Z-Boy's well-established brand name and worldwide exposure make it a stock with considerable staying power and growth potential.

2. Sleep Number Corporation

While less well-known than La-Z-Boy, Sleep Number Corporation (SNBR) has many of the same virtues. At $1.38 billion, the company is large enough to survive most downturns in the market. What is more, it has a history of long-term growth. Sleep Number participated in the 2019 rally in furniture stocks, but it was still reasonably valued as of November 2019.

Sleep Number Corporation's stock was at $48.43 on November 1, 2019. That was close to the record high of $52.08 hit earlier in the year. Near record-high prices mean that Sleep Number is no longer the steal that it was at 19 cents during the dark days of the 2008 financial crisis. However, most healthy companies should be hitting record highs later in a bull market.

3. American Woodmark Corporation

American Woodmark Corporation (AMWD) was trading at $99.59 a share in early November 2019. The company was undervalued by some measures. The P/E ratio of 19.78 was low compared to the S&P 500 average of 22.82. From a technical point of view, the stock had substantial momentum late in the year. It was also near the crucial $100 level where breakouts (and breakdowns) often occur.

American Woodmark, with a market capitalization of $1.69 billion, manufactures and markets kitchen cabinets and vanities. It offers a wide variety of home construction and remodeling choices. American Woodmark supplies approximately 500 different lines of cabinets marketed under brand names, such as Timberlake and Waypoint Living Spaces. The company sells its products through homebuilders, independent distributors, and various retail outlets.

4. Leggett & Platt Inc.

Leggett & Platt Inc. (LEG) stock was trading at $51.28 a share as of November 2019. The stock experienced a very impressive rally during October 2019. Even after those gains, Leggett & Platt still offered a substantial dividend of 3.12%. RSI numbers strongly suggest that the rally may have left the stock in an overbought condition in late 2019. However, the Q3 earnings beat and the company's substantial $6.75 billion market cap are favorable for the long run.

Leggett & Platt operates through four business segments that produce furnishings, industrial materials, commercial products, and specialized products. Its diverse manufacturing gives it a broad revenue base, serving customers in the furniture industry, automobile manufacturers, the aerospace industry, and telecommunications companies. Leggett & Platt has manufacturing facilities spread across the globe.

5. Basset Furniture Industries Inc.

Basset Furniture Industries Inc. (BSET) is the smallest company on the list, with a market cap of about $150 million in November 2019. The company's relatively small size makes it inherently riskier in the long-run. However, the firm's stock appeared to be in an excellent short-term technical position in late 2019. Basset Furniture operates through three segments to produce and distribute its product portfolio. It takes its name from its headquarters in Bassett, Virginia.

Bassett Furniture was trading at $15.25 as of November 1, 2019. The stock offered a generous dividend yield of 3.28% but was also overvalued by some measures. More importantly for short-term traders, the stock was showing decreasing volatility after a steep decline that lasted about two years. Lower volatility is often a bullish sign, and Bassett's stock seemed to be oversold. Given the general uptrend in furniture stocks, a fierce rally seemed possible. However, the combination of high valuation and small size suggested a cautious approach, particularly for long-term investors.