Newsmax, the Trump-friendly TV station that soared over 2,000% after IPO

Newsmax, the cable TV network that repeated Donald Trump’s 2020 election fraud claims, went public on Monday and soared more than 2,000% in just two sessions. At its debut, the stock was priced at $10 per share, before climbing to a high of $265 on Tuesday. However, it corrected sharply in Wednesday’s session, closing at $49 per share. The stock — which the U.S. media is already calling a “meme stock,” meaning a speculative frenzy-driven asset — has been so volatile that trading was halted up to 10 times on its debut day. Bearish investors, who bet against certain stocks, have also taken positions in Newsmax, and some have already profited, as the stock plunged 79% in its third session.

The sharp rally in its first two trading days briefly pushed Newsmax’s market capitalization above that of its main competitor among pro-Trump media outlets, Fox News. At its peak, Newsmax reached a market value of $29 billion, surpassing Fox’s $24 billion and even eclipsing The New York Times’ $8 billion. However, despite this valuation surge, Newsmax is not a profitable company. While Fox Corporation posted a profit of $13.98 billion in 2024, Newsmax reported a $55 million loss in the first half of last year, despite generating $80 million in revenue during the same period.

Nonetheless, the company’s CEO, Christopher Ruddy — a former New York Post journalist and longtime Trump associate — has personally reaped massive gains from the stock’s performance. Ruddy, who owns nearly a third of the company’s shares, has seen latent capital gains of $9.1 billion from the stock surge. This places him among the wealthiest people in the United States, according to Bloomberg’s billionaire index, ranking him above figures like Bill Ackman and Mark Cuban. However, his fortune remains below that of Rupert Murdoch, the former chairman of Fox, whose net worth stands at approximately $22.5 billion.

It is unusual for an independent cable news network to go public, particularly in an era where traditional television networks face declining ad revenues due to competition from digital platforms. “This is the newest entry into the pantheon of meme stocks,” Steve Sosnick, chief strategist at Interactive Brokers, told Bloomberg, referring to Newsmax’s dramatic stock surge. “Whether or not that persists, who knows, but it has all the hallmarks of a meme stock. There needs to be some sort of passion to enable investors overlooking fundamentals, and Newsmax fits that bill.”

The company itself fueled the excitement surrounding its IPO, posting messages such as “Become an owner of NEWSMAX!” In an editorial published on its website, Ruddy expressed hopes that “hundreds of thousands of Americans” would become co-owners of Newsmax. He urged supporters to buy shares in the company, assuring them that “Newsmax is rising because Americans like you are tired of incredible media bias, now reaching a dangerous level.”

This phenomenon is reminiscent of the meme stock frenzy of 2020 and 2021, when retail investors poured into stocks like GameStop, disregarding traditional financial metrics and causing sharp losses for short sellers. Trump Media & Technology Group experienced similar volatility after making its highly anticipated stock market debut last October. The company operates the Truth Social network, with Donald Trump holding a 57% stake.

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