MAGA favorite Newsmax is the hottest new meme stock after a 2,190% post-IPO surge
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- Newsmax stock surged as much as 2,190% after its IPO debut, reaching $229 per share on Tuesday.
- The right-wing cable channel's market value exceeded $20 billion.
- The stock's rise may be due to the limited shares offered in the 'mini IPO.'
Newsmax has cemented its status as a meme stock following its IPO debut on Monday.
The right-wing cable news channel saw its stock soar past its IPO price of $10, closing at $83.51 on Monday. The stock went on to more than double on Tuesday, hitting an intraday high of $229.
It's stunning rally since going publish represents a two-day gain of 2,190%, catapulting the media company's market valuation to more than $20 billion and making its founder and CEO, Chris Ruddy, a billionaire on paper. The market cap shows investors also think that the company is more valuable than legacy brands like The New York Times.
The massive gains could be partly due to the small number of shares offered in the "mini IPO."
Newsmax sold 7.5 million shares at $10 per share, raising $75 million for the company. For context, nearly 9 million shares traded hands on Tuesday at 3:02 p.m.
"Given that it's got a small float, I think that makes it susceptible to these big moves and has that meme stock characteristic," Paul Hickey, co-founder of Bespoke Investment Group, told Business Insider. "There's not a lot of stock to trade in the market relative to the market cap, so it can be pushed around."
Retail investors were piling in on the trading activity in Newsmax. It was a top trending ticker on Stocktwits, with users salivating over the massive gains.
"This is greed to the max," one user said, skeptical that the monster gains would continue. "Enjoy the speculative ride for now."
It's been boom times for conservative news outlets following Trump's election victory in November. The president is a regular guest on right-leaning channels including Newsmax, which has helped boost ratings for broadcasters. While the network lags behind right-wing news giant Fox, its popularity has risen steadily since the 2024 election.
The company reported revenue of $171 million and a loss of $72 million in 2024.
Newsmax raised $225 million in February via a private offering of preferred shares. The company trades on the New York Stock Exchange under the ticker symbol "NMAX".