In sports, there are few things more exciting for a team to watch that come back than a reasonably insurable shortfall to win. I grew up watching Hall of Famer Joe Montana on his birthday, taking his reputation as Notre Dame’s “Comeback Kid” and turning it into four Super Bowl for the San Francisco 49ers. Since then, Tom Brady made his own case for the moniker, leading the Tampa Bay Buccaneers to Super Bowl LV with multiple inertia for the 43-year-old quarterback.
Investors also like a good turnaround story. It always inspires one to see a struggling business and overcome past challenges themselves, especially when it results in people who saw it.
Already in 2021, many stocks are making their case for being the Comeback Kid of the Year. Below, we will look more closely at the three candidates already doubled in 2021, with the goal of whether they can prepare for the big things to come.
Tilre (NASDAQ: TLRY) The end of 2010 was one of the stock market cracks. As soon as the stock of marijuana came into the limelight, Tilre was among the most famous cannabis cultivators in the market.
Yet when tough times hit marijuana stocks, Tilre took a huge hit. Tilre’s shares lost more than half their value in 2020.
Unlike many companies, however, Tilre decided to do something about it. The cannabis cultivator announced ambitious plans in late December to merge pot stocks Efria (Nasdaq: APHA). The merger would create the world’s largest marijuana company, which would be in a strong position to compete against other cannabis industry veterans, as marijuana investors expected the US to reduce marijuana to the federal level with a new administration in Washington .
Under the terms of the deal, Tilray’s stock will survive, with Afria investors receiving 0.8381 Tilre shares per Afria share. Yet Aphria is a large company, and its CEO will lead the joint company going forward.
Since then, Aphria’s solid gains have only helped raise Tilre’s stock. Tilre is more than 125% in 2021.
Even after his gains so far this year, Tilre has only come back to where he started 2020. With this, if the marijuana market in the US starts to open up more aggressively for the Canadian company, then the hemp stock will increase a lot.
Of the earth (NASDAQ: TELL) Shares that fell more than 80% by 2020 were the hardest stocks among this group of three. The natural gas expert’s link to the energy industry was the source of its downfall, as the COVID-19 epidemic shook and caused the energy markets. Massive disruptions sending the entire region down sharply for the entire year.
Tellurian expects the US to take advantage of the surge in natural gas supply so that it can be exported to other countries. The company’s proposed driftwood liquefied natural gas (LNG) terminal in Louisiana, jeopardizing project development in early 2020.
However, the energy market has strengthened to some extent, sending oil prices back above $ 50 per barrel. It does not directly affect Tellurian, but earlier this month, company co-founder Charif Sookie said LNG experts would likely begin construction on driftwood by summer. It has nearly tripled the stock so far in January.
Despite massive recovery, tellurin is down more than 45% since the beginning of 2020. The energy market has a lot to recover before returning to normalcy, but it will be important for Tellurian to take full advantage of the improved environment it wants to be on the course for a full return.
Eventually, TransEnterix (NYSEMKT: TRXC) In 2020 went through a major setback. The stock lost about 60% of its value during the year, as the small medical-device manufacturer saw a huge loss without revenue.
TransEnterix reached heights in mid-2018, as investors praised the prospects for its Senhance surgical robotic system. Yet the company has thus far failed to meet any significant sales of the system, posting only $ 8.5 million in revenue in 2019 and just $ 2.07 million in the first nine months of 2020.
The big news for TransEnterix recently came from Europe where regulators approved its Intelligent Surgical Unit accessory for the Senhas system. The so-called “augmented intelligence” system provides machine-vision capabilities that make it easier for surgical professionals to perform procedures. Investors have responded by sending shares of TransEnterix to more than 500% year to date.
TransEnterix stock is up more than 150% since the end of 2019, following its steep rise in 2021. This creates a major gamble in stocks, especially given the company’s poor track record. But if TransEnterix can actually start selling its system, there may still be a lot of upside for the stock.
Big risk for big reward
There is always substantial risk from investing in turnaround shares. If a return does not fully take shape, the brief share-price gain can quickly reverse.
However, when things continue well, large gains are also possible. If you have a high tolerance for risk, then looking for stocks like these three may find some promising candidates for your portfolio.
Among these three companies, TransAnix and Tellurion are more speculative, relying on considerable execution to reach their full potential. Tilre provides the clearest path to continued profitability in a favorable environment.