Helicopter Shortage: An Investment Opportunity?

In the May 12th edition
of Fortune Magazine, there is an interesting article titled "Copter
Crisis" that delves into how the growth in offshore drilling for oil and
gas has led to increased utilization of helicopters to get to and
from the offshore platforms. This offshore drilling boom combined along
with increased usage of choppers for private travel has led to a
shortage of helicopters and their parts.

Based on the earnings forecast of offshore drillers like Transocean (RIG), Diamond Offshore Drilling (DO) and Noble (NE), the offshore oil drilling boom is likely to continue for years to come. In fact Transocean earned over $1 billion in just the first quarter of this year. We picked up Diamond Offshore Drilling for the SINLetter model portfolio
in January 2007 and have been rewarded with a gain of over 70% over 16
months despite the recent pullback in the stock. Diamond Offshore was a
proxy investment for rising oil prices and it appears that choppers
could be a proxy for the offshore drilling boom based on the number of large offshore oil finds in the Gulf of Mexico and off the coast of Brazil over the last few years.