Newsmax (NMAX) Shares Continue Meteoric Rise After IPO

Shares of Newsmax (NMAX) soared by 180% on Tuesday, adding to the astonishing 735% surge recorded on Monday, just after the conservative news outlet launched its initial public offering.

The company brought in $75 million through its IPO on Friday, setting the initial share price at $10. By Tuesday afternoon, the stock’s dramatic rally had boosted Newsmax’s (NMAX) market capitalization to approximately $20.8 billion, with shares finishing the day at $234.

Read more about today's Newsmax stock moves and market action here.

“This incredibly successful offering, combined with our previous Preferred Offering, provides us with the capital and financial freedom to accelerate our growth initiatives, expand our programming, and further enhance our digital presence,” said CEO Christopher Ruddy, who founded the company in 1998, is a media mogul and friend of President Trump.

Legal Headwinds and Public Scrutiny

Originally becoming a cable network in 2014, Newsmax has faced substantial backlash and legal scrutiny for amplifying conspiracy-related content. A major legal challenge comes in the form of a $1.6 billion lawsuit filed by Dominion Voting Systems, which accuses the network of spreading misinformation during its coverage of the 2020 U.S. presidential election. Newsmax referenced the lawsuit as a business risk in its most recent 10-K report to the SEC.

The media company also reached a settlement in 2024 with another voting technology firm, Smartmatic, over similar allegations. As stated in the filing, Newsmax (NMAX) has paid $20 million of the agreed $40 million settlement amount to date.

Often positioned as an alternative to Fox News, the outlet has additionally been criticized for broadcasting false narratives surrounding the events of January 6th and other controversial topics.

Financial Performance and Control Issues

In 2024, Newsmax saw its revenue rise by approximately 26%, reaching around $171 million. Despite this growth, the company reported a net loss of $72 million for the year.

Additionally, the firm disclosed in its filing that it has uncovered "material weaknesses" in its financial controls, warning of the possibility of "a material misstatement" in its financial statements that may not be detected "on a timely basis."

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