Shares of Cable TV channel Newsmax (NMAX) started officially trading on the New York Stock Exchange (NYSE) Monday. Shares exchanged hands quickly with intraday gains of more than 600% with more than 5 million shares changing hands.
The stock’s debut comes on the heels of the disappointing IPO of the AI company CoreWeave (CRWV) on Friday.
In September 2024, Newsmax filed for its IPO with the SEC identifying early 2025 as the company’s window for pricing. On Friday, Newsmax raised $75 million with the IPO with the offering price of $10 per for a float of 7.5 million shares.
This morning’s first trades of Newsmax crossed the tape at $14.00 followed by a steady stream of buying that shot the price to more than $74 per share.
According to Fidelity Investment’s data, Newsmax shot its way into the top 20 companies traded on Fidelity’s trading platform.
The spike in Newsmax’s price along with heavy volume traded on Fidelity’s platform suggests that the company may be an instant “Meme”, envoking memories of names like GameStop (GME) and AMC Entertainment.
Meme stocks came into popularity in early 2021 as they remained in control of retail investors and online investing communities like the popular “Wallstreetbets” on Reddit. For the record, NewsMax did receive mentions on Wallstreetbets this morning.
GameStop’s first month of trading as a Meme Stock saw shares jump more than 4,000%. The stock has never reclaimed its all-time high price and is now trading more than 85% lower.
The timing of the IPO comes as consumers have been reevaluating streaming bundles and cable TV packages in favor of individual streaming services. While the move may narrow audiences it still leaves live cable news channels with a large portion of advertising space for revenue.
Newsmax’s founder, Christopher Ruddy, cited that Newsmax is the fourth largest cable news channel in the U.S. behind CNN. The channel continues to gain views as its viewer base rallies around the Trump White House and policies.
Short-term traders are likely to be attracted to Newsmax’s volatility and price swings over the next few weeks.
Long-term investors considering the purchase of Newsmax shares may want to wait to fully gauge long-term sentiment towards the company and the stock’s early price trends. It is common for most IPOs to trade for weeks before finding a reliable flow of volume and reliable pricing.
