Mary Corbet highly recommends Quaker Stitch for lettering. She also has other stitches she uses for more delicate letters, heavier letters, etc. which she also mentions in this article.
Here is her Quaker Stitch tutorial. Since I use stem stitch for letters occasionally I will try this on my next piece that has letters. Note that to get the stitches that create Quaker Stitch exactly where you want them on needlepoint canvas, you'll need to use a sharp needle to pierce the threads. You can't do this stitch just on the holes between the threads of needlepoint canvas.
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