Most income investors ignore small companies. Conventional wisdom says that large, mature companies pay dividends and small companies don’t.

That’s hardly the case.

Nearly 10,000 small caps trade on U.S. exchanges. Of those, 3.3% carry a yield of 6% or more. Believe it or not, that’s roughly the same as the S&P 500 Index, where 3.6% of the companies on the index yield above 6%.

Overlooking small companies is a mistake. While many small firms retain their profits to reinvest in the business, others generate enough cash to fund growth and pay shareholder dividends.

It would be dangerous, of course, to assume that every small company is fast-growing and has a promising future. A little more vetting is required.

Let’s eliminate companies that are trading for less than $5 a share. These stocks are often being avoided because of a serious problem in the company’s business. We also want small companies whose shares are liquid: At least 100,000 shares should change hands daily.

These parameters bring the number of potential investments down to a manageable number. Here are two that stand out.

Capital Product Partners (Nasdaq: CPLP)
The circumstance that is playing in Greece-based Capital Partners’ favor could turn into a great opportunity.

Capital Partners owns and leases small and medium-sized oil tankers. Right now, its fleet numbers 18. Its long-term rental contracts for these vessels range from three to 10 years.

Nine of the company’s contracts expire in 2010. Where shipping rates end up when those contracts expire will shape the company’s future success. Shipping prices currently are lower than shippers would like, but pricing can change quickly. For instance, shipping rates have already risen more than +10% this month alone.

Capital Partners is reasonably valued right now. That’s likely attributable to the unknown future of international shipping rates. The company currently has a forward P/E of 10.5. The market sees some measure of hope in the future, though, as the company is selling for 1.5 times book value.

Capital Partners currently yields 16.7%. Its 2008 earnings came in at $2.00; trailing 12-month EPS is $1.92, easily enough to cover the company’s $1.61 annual payout.

If you believe in a recovery and think it will lead to a rebound in global shipping, as I do, these shares are a steal. If you’re more pessimistic about the future, the next stock I’ve found might be just the ticket for you.

Regal Entertainment Group (NYSE: RGC)
The great thing about theater stocks is that economic conditions don’t really matter. People go to the movies even when times are tough because it’s relatively cheap entertainment.

What does matter to theater operators, however, is how good the movies are. While Regal doesn’t have any control over what Hollywood turns out, great movies people can’t wait to see drive traffic to the box office.

Regal operates more than 550 U.S theaters, about 7,000 screens. These theaters are regarded as among the best in the industry. About three-quarters have stadium-style seats, and each either has or is being upgraded with Sony 4K digital-projection systems that have out-of-this-world picture quality.

The company operates in 90% of the country’s top 50 markets and has an industry-leading 16% market share. Some 66 million people went to a movie at Regal in the second quarter, +12% more than the same period of 2008. Those customers also paid more, spending an average of $8.17 a ticket, up +7% from the previous year. This shot revenues up +17% for the quarter.

Regal earned has earned $0.54 per share during the past 12 months, a +15% gain from 2008’s results. At the stock’s current prices, that’s a trailing 12-month yield of just above 6%.

This stock can weather any economic storm, making it ideal for those who are worried about a prolonged downturn. However, a year filled with lackluster movies can really hurt this. Luckily, 2010 should be a banner year with names like Iron Man, Toy Story and Harry Potter gracing the marquee.