The S&P 500 index was down 25% through the third quarter, soured by the worst inflation in decades. This and other broad market trends played out through Minnesota's publicly traded companies as well.
Only eight Minnesota-based public companies finished the third quarter, which ended Friday, with a positive total return for the year.
The Piper Sandler Minnesota Index was down 17.6% in the first three quarters.
Among Minnesota's public companies, including members of the S&P 500 index and smaller companies, 68 finished down over the first three quarters of 2022, including 60 down double digits and 14 of them down by more than 50%.
Digi International has been the best Minnesota stock to own this year. An emphasis on generating recurring revenue has helped fuel the Hopkins-based company's financials and share price.
"A summer rally that saw the S&P 500 win back half its year-to-date losses faded by mid-August, turning into new lows for the major stock averages by the end of Q3," wrote Ameriprise chief market strategist Anthony Saglimbene in his newsletter. "This was undoubtedly a disheartening development for investors hoping markets had sailed through the worst of the storms."
In an interview, Saglimbene noted some positive aspects pointing to Monday's market rise: that traders may believe the markets are oversold technically and that the fourth quarter has more favorable seasonality patterns. The S&P 500 ended the day up 2.6%.
Saglimbene said investors and analysts will be watching the Federal Reserve's interest rate increases, but a recession or economic turndown is not going to surprise companies and individuals who have managed costs well this year.
"Consumers and businesses are in really good shape and hopefully prepared to weather a downturn in the economy," Saglimbene said.
Some of the worst performers among Minnesota-based companies are smaller firms seeking strategic alternatives. Calyxt, the Roseville-based company that uses gene-editing technology to create high-value plant-based chemistries, announced on Sept. 22 that its board of directors was seeking strategic alternatives.
Calyxt's technology had its roots at the University of Minnesota, but since going public in 2017 has had three CEOs and has switched from producing its own gene-edited crops to licensing its technology to other companies.
The company's stock price had good growth after pricing its IPO at $8 a share in July 2017, peaking over $29 a share in October of that year. But the share price has consistently fallen since then. It has been trading under $1 since March and is among a handful of Minnesota-companies that have gotten a continued listing notice from their exchanges for falling below the $1 per share threshold.
Qumu — a Minneapolis-based provider of cloud-based enterprise software that helps firms manage live and video on-demand content — also received a delisting notice from Nasdaq and earlier this year a large shareholder of the company added a proposal to the company's annual proxy statement asking the board to hire an investment bank to look at the possible sale of the company. Shareholders narrowly approved 52% to 48% the non-binding proposal at the annual meeting.
"Qumu's board of directors appreciates all shareholder viewpoints and will continue to be open to and evaluate the feedback received from shareholders as we focus on maximizing long-term shareholder value," said Qumu's chair Neil Cox in a news release announcing the shareholder votes.
Minnetonka-based Pineapple Energy is looking to get powered up after completing a merger and name change with publicly traded Communications Systems Inc. that was completed earlier this year. It is a solar energy and storage company mainly doing business in Hawaii. Its new chief financial officer starts next week.
Oil and gas exploration and production companies were among the leading companies in the S&P 500 index during the first three quarters of 2022, led by companies such as Occidental Petroleum Group, where Warren Buffet's company Berkshire Hathaway has been adding to its position.
That sector strength carried over to Minnetonka-based Northern Oil and Gas, which is the second best performing stock in Minnesota.
On Friday, Northern Oil and Gas announced a $157.5 million deal to acquire more oil and gas interests, including properties in Texas and New Mexico that are part of the resource rich Northern Delaware Basin.