Newsmax Outstrips Top-Rated Fox in Trading Bonanza

And just like that: A new meme-stock star is born.

In its second day of trading on Tuesday, shares of Newsmax — a.k.a. the conservative cable news network — climbed 183%, just a day after popping 735% in its trading debut. That makes the company’s IPO one of the most ascendant ever. And, for Newsmax, it couldn’t have happened at a better time.

We Meme Business

Of course, meme stocks by definition trade at levels well beyond their company’s estimated value, according to any traditional metric. And Newsmax fits the bill to a tee. After the remarkable rocket ship ride in the past two days, the company now has a market cap exceeding $30 billion on reported revenue of just $171 million last year.

Which means even by memestock standards, Newsmax is a shooting star:

• By market cap, Newsmax surpassed legacy media players Warner Bros. Discovery — which posted revenue of $39 billion last year and owns a global streaming service with nearly 120 million subscribers — as well as Fox Corp., which has enjoyed a Trump Bump to the top of TV news ratings charts. Fox News averages around 3 million primetime viewers, compared with Newsmax’s 309,000, according to Nielsen data.
• At its current market cap, the company is also trading at a price-to-earnings ratio of around 175, according to Bloomberg calculations, which is way higher than the ratios of 4 and 14 once seen by legendary meme stocks Gamestop and AMC, respectively.

News Flash: The stock’s meteoric jump has, obviously, been great for the company’s founder and CEO, Christopher Ruddy, who owns roughly a third of Newsmax shares. That means his net worth has soared past billionaires like Mark Cuban and Bill Ackman, according to Bloomberg’s Billionaires Index. It’s good timing, too: The news network remains in ongoing litigation with Dominion Voting Systems, which is suing Newsmax for defamation over claims its voting machines were rigged in the 2020 election. Dominion is seeking $1.6 billion in damages; the company previously scored a $787 million settlement with Fox in a lawsuit litigating similar claims. In other words: It’s a pretty good time to be flush with a few billion extra dollars.