Ben Franklin, founder of the US Postal Service, now a $66 billion revenue business, had no notion what he was setting in motion.
But now it's listless, with a current reshuffling that's trying to save its long-standing service, mired in red pension ink and rising stamp costs.
Among the reasons for its slide is increased competition, for what had once been a virtual monopoly.
Given instant messages, emails, texts and tweets, the U.S. Postal Service's snail mail is a relatively obsolete way to communicate, but we still need letters and postcards to be delivered.
And one inkling that the transportation industry is on its way to a comeback is that the U.S. economy grew at its fastest pace in more than a year in the third quarter, the Commerce Department said Friday.
One encouraging sign was that consumers continued to step up spending, as more Americans got jobs, and their disposable incomes rose. Consumer spending, which accounts for more than two-thirds of demand in the economy, rose 2 percent in the fourth quarter, compared with 1.7 percent in the third and 0.7 percent in the second.
But you can't get too carried away with this, as the Federal Reserve has pledged to keep interest rates low through at least 2014, a sign the central bank doesn't think economic growth will be robust. So transportation demand is likely to be a slow-growth proposition.
As for the postal service, volumes have declined by more than 20 percent over the past five years, a decrease of about 40 billion pieces of mail, according to Standard & Poor's.
Who wins? UPS and FedEx are the small-package handlers seeing rising volume from Internet retailers that rely on them to ship their goods.
It's not a given for them. The Dow Jones Transportation Average, made up primarily of trucking, delivery and airline shares, is up 3.8 percent over the past 12 months, which is no rally given that the S&P 500 finished flat in 2011.
And the conglomeration of shipping companies, which include logistics and land transport companies, have seen a 20 percent three-year average annual return, according to Morningstar, and they should both jump once the economy rebounds.
S&P Capital IQ says that FedEx and UPS should be "the two big winners as the transportation of small packages evolves away from the post office."
FedEx has a "strong buy" rating, while UPS has a "buy" from Standard & Poor's stock analysts.
Even railroads, about as old-school as could be, are benefiting from the "cheaper-by-rail" business due to higher fuel costs. Investors have driven up their shares up an average of 36 percent over the past three years.
The wily Warren Buffett is in a great position, as a mid-continent carrier he owns will get a boost when the economy comes back. His Berkshire Hathaway, which bought railroad Burlington Northern Santa Fe in 2010 for $27 billion, is in great shape. That's a vote for the transportation industry and that should support investor views that transport is a good investment.
Here are a few stocks that could beat the postman as parcel and message carriers replace the bag carrier, including UPS and FedEx.
"Big Brown," as the United Parcel Service is known, is the world's largest parcel delivery company with more than 500 planes and 100,000 vehicles to deliver on average 15 million packages a day.
Investor Takeaway: Morningstar says this is one of the companies that "is likely to capture the incremental mail and packages that need to be there on a time-definite basis, and should also see major benefits if Saturday mail delivery (by the postal service) should cease," said S&P in a research note. UPS' shares have a 10-year average annual return of 4.6 percent.
The company said late last week that it will take a $827 million pre-tax charge in the fourth quarter as it changes to a mark-to-market system of accounting to more accurately report changes in its pension plan. The change will not affect pensions.
Company Profile: FedEx, a $29 billion company, is one of the largest express delivery firms in the world. Total company revenue for the most recent fiscal year was about $40 billion.
Investor Takeaway: S&P rates the stock a "strong buy." Analysts give it 13 "buys," seven "buy/holds," and seven "holds," according to S&P ratings. FedEx is clearly the low-cost delivery server. Morningstar says that "while short-term results may suffer due to rising fuel costs, the firm's powerful network is here to stay."
Company Profile: Union Pacific is the largest American railroad, hauling everything from coal to containerized freight from Asia. Its company-owned right-of-way gives it an impregnable resource.
Investor Takeaway: Morningstar analyst Keith Schoonmaker writes that "more than other railroads, UP has upside potential in repricing old contracts, some of which lack effective fuel surcharges or fail to fully capitalize on the pricing power rails have enjoyed only recently." S&P analysts survey results in 13 "buys," nine "buy/holds," and six "hold" ratings, about as good as you'll find.
Company Profile: Norfolk Southern provides rail transportation service in the eastern U.S., operating over 20,000 miles of road, with an extensive intermodal and coal service network and a freight business.
Investor Takeaway: S&P's survey of analysts found 11 "buys," eight "buy/holds," and eight "holds," and one "weak hold." This company is in a great position when the economy rebounds.The company hit record revenue, net income, and earnings per share in both the fourth quarter (up 17 percent, 19 percent, and 30 percent year-over-year, respectively) and full year for 2011. Its shares are up an average annual 33 percent over the past three years.
CSX operates the largest rail network in the eastern U.S., with a 21,000-mile rail network linking 23 states and two Canadian provinces, and owns companies providing intermodal and rail-to-truck services. It is one of the nation's primary transporters of economic basics such as coal and steel.
Investor Takeaway: With shares already up 9.1 percent this year, any economic recovery will give it an additional boost. S&P has it rated "buy." It gets 11 "buy" ratings, 10 "buy/holds," and seven "holds," according to S&P's survey of analysts.
Company profile: Con-way is the third-largest domestic less-than-truckload carrier in the nation. Again, any rally in the economy will give it a boost. This is a $2 billion market value company.
Investor takeaway: S&P found five "buys," five "buy/holds," and 11 "holds," in its summary of ratings.
Company profile: Canadian Pacific provides freight transportation over a 15,000-mile railway network serving Canada, as well as the U.S. Midwest and Northeast. It transports bulk commodities, including grain, coal, and fertilizers, as well as cars and auto parts.
Investor takeaway: S&P analysts recently downgraded it to "hold" from "buy" on a valuation basis. But railroads are one of Warren Buffett's favorite industries.
If you want to indirectly play North American shale oil fields, try this stock or Berkshire Hathaway's. It bought railroad Burlington Northern Santa Fe last year for $27 billion and it is geared to take advantage of the oil-fields boom, which has recently been boosted by the Obama administration's decision to reject TransCanada's plan to build the Keystone XL oil pipeline, making rail the default transport.
Kansas City SouthernCompany Profile:
Kansas City Southern is a relatively small railroad in terms of size — it derives half its $1.5 billion revenue on 3,200 miles of track in the central and southern U.S.
Investor Takeaway: Morningstar says its most beneficial sales "are produced by operating long-term concessions on 2,700 miles of rail in Mexico and 47 miles of track adjacent to the Panama Canal."
Morningstar adds that the company "is developing a significant intermodal franchise including access to Mexican ports, and its 50 percent ownership of the Panama Canal railway, are well-placed to carry containers bound for Mexico and the U.S. Its shares are up 9.4 percent this year.
S&P found eight "buys," five "buy/holds," and eight "holds," among the analysts who follow the stock.
TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
CNBC Data Pages: