Newsmax Shares Surge Over 700% During Debut Trading Session
Newsmax (NMAX), a conservative news media outlet, debuted today on the New York Stock Exchange (NYSE). Share prices ended the day at $83.51, marking one of the best IPO debuts in years. The company announced it raised $75 million on an offer of 7.5 million shares at $10.
The stock saw heavy volume throughout the day for a new listing, with more than six million shares traded. The ticker trended on popular trading forums like Reddit's WallStreetBets and Stocktwits through the day, It closed at 83.51 after opening at 14, representing a gain of nearly 500% on the day.
It was a surprising move for the market, given recent disappointments in other IPOs. The Nvidia-backed CoreWeave (CRWV) fell 7.3% today in its second day of trading. A disparity in the excitement between a technology company and a news media outlet is perhaps telling. Have traders faced disappointment too many times in recent past with tech-focused companies quickly trimming early-day gains?
If the popularity in the trading community holds, Newsmax has the potential for more gains if the surges of past meme stocks is any indicator. Still, Newsmax is a company that is not yet profitable, with its filing with the Securities and Exchange Commission (SEC) showing a $55.5 million loss in the first half of 2024.
However, this may be one reason why investors are buying the stock—the opportunity for growth and profitability. It also comes at a time when conservative-tied stocks are performing well and grabbing attention. Newsmax has been praised by President Donald Trump, and the outlet focuses its content to put the current administration in a good light.
Newsmax settled a lawsuit with Smartmatic Corp last year following its reporting on the 2020 presidential election, which Smartmatic claimed defamation. The settlement hasn’t been made public, but Newsmax has prevailed as a network since its coverage of the election.
Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. #@fxwestwater
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