Transportation In the Spotlight: United Parcel Service, Inc. (UPS), FedEx Corporation (FDX)

The slowdown in transportation extends to railroad stocks, where in the 4Q Norfolk Southern Corp. (NYSE: NSC) reported a 14% profit decline as a result of weak fundamentals in coal. Coal demand has waned amid rising competition from natural gas, which hurts Norfolk’s Southern electricity business and triggered a 23% decline in 4Q coal revenues. The soft global economy has hurt Norfolk Southern’s commodity export volumes in items such as corn and ethanol in recent quarters. The company is experiencing rising volumes in other segments, however, including chemicals, auto and housing.

Norfolk Southern is focused on returning value to shareholders via dividends and its target dividend payment  is one-third of earnings. In August, the company increased its quarterly dividend by 6% to $0.50 per share.

Sharing the Love

While chocolate might spring to mind when it comes to the holiday for sweethearts, there is also an opportunity for transportation companies. Valentines Day is a $18.6 billion market opportunity, according to the National Retail Federation. The average individual will spend $130.97 on Valentines Day this year, which is a modest increase over last years levels of $126.03 per person. More than one quarter of shoppers will make their purchases online, according to UPS, which bodes well for transportation companies. Last February leading up to Valentines Day, shares of UPS only got a modest pop of less than 1% while Fed Ex shares climbed 3%.

The Valentines Day-pop may not be the long-term solution that transportation companies need for the bigger picture but at the very least — if stock price rise once again this month — the gains could provide some short-term profits for shareholders.

The article Transportation In the Spotlight originally appeared on Fool.com and is written by Gerelyn Terzo.