Gains for the stock market add up over the years, but a few stocks give you extremely strong short-term performance. Over the past year, some stocks have tripled in value, and Teck Resources (NYSE: TECK), Tesaro (NASDAQ: TSRO), and Blucora (NASDAQ: BCOR) are among those rare few that have managed to deliver huge returns to their shareholders. Yet after such a huge run-up, the big question for these stocks is whether they have the staying power to keep moving forward. That's the question we'll try to answer for each of these stocks below.
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Teck bounces back
The commodities markets have been extremely volatile in recent years, and Teck Resources found itself the victim of poor demand for many key commodities heading into 2016. However, last year was an extremely positive one for the company, which saw rebounds in the prices of key base metals like copper and zinc. In addition, the price of metallurgical coal for steelmaking purposes got a nice boost as well.
Unfortunately, commodity price gains can quickly reverse themselves and fall back downward. However, Teck has taken advantage of the favorable conditions to shore up its balance sheet, refinancing debt toward longer maturities and reducing its internal cost structure. With those improvements largely complete, Teck has the ability to fare better regardless of future conditions. Moreover, given its recent investment in the Canadian oil sands, Teck has exposure to the energy markets as well, adding to its diversification and giving it another growth driver for the future.
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Image source: Teck Resources.
Tesaro lands a big approval
In the biopharmaceutical world, a lot rides on being able to find success with candidate drugs. Tesaro hit the jackpot with its cancer treatment niraparib, which has proven in clinical trials to be surprisingly effective in helping to treat certain types of ovarian cancer. Gains for the stock began last June, when phase 3 trial data showed strong efficacy for niraparib. The company proceeded to file for approval from the U.S. Food and Drug Administration later in 2016, and in March 2017, the FDA approved niraparib for treating ovarian cancer, doing so ahead of schedule.
Tesaro won't necessarily have the ovarian cancer market to itself for long, as rivals like AstraZeneca are looking at similar treatments of their own to treat the disease. Nevertheless, some believe that niraparib could generate billions of dollars in sales, giving the small company a blockbuster to act as the foundation for Tesaro's future growth.
Blucora bounces back
Finally, Blucora has also managed to more than triple. Yet the company behind the TaxAct tax preparation brand still faces some major challenges to its future success.
Between late 2013 and early 2016, Blucora stock lost about 80% of its value as investors worried about the viability of the financial services company. Yet the stock started to rebound about a year ago, following a tax season in which Blucora served fewer customers but still managed to boost overall revenue thanks to price increases. Since then, the company has made some key strategic moves, including selling its InfoSpace online search business and Monoprice peripherals company to raise cash and moving its headquarters to Texas. Even after the big gains, Blucora shares still trade well below their 2013 highs, showing the company has more work to do before it can declare final victory.
It's unusual for stocks to triple in a single year, and all three of these companies have done well to achieve that formidable task. Of these three stocks, Tesaro arguably has the most room for further upside, especially if its drug pipeline continues to produce blockbuster winners over the long run.
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