Stock prices for Newsmax are surging - is it worth investing now?
In the dynamic world of stock market investments, Newsmax (NYSE: NMAX) continues to be a subject of interest, with its shares experiencing a rollercoaster ride since its Initial Public Offering (IPO) at the end of March.
After an initial surge driven by meme-stock momentum, the stock has faced a steep decline, falling roughly 93.5% from its lifetime high before a recent rally pushed it up 13.5% on June 30, 2025. This recent uptick can be largely attributed to Newsmax's inclusion in the Russell 2000 index, triggering buying from Exchange-Traded Funds (ETFs) and index funds.
Despite the recent rally, Newsmax's stock valuation, currently approximately $1.9 billion, still carries substantial risk. The company's business model has been described as declining, and it faces looming legal risks that could weigh on future performance.
Newsmax Inc. owns the Newsmax Media group, which operates a successful cable news channel—now the fourth highest-rated cable news channel—and reaches over 40 million Americans regularly through multiple platforms, including streaming services and publications. This broad media footprint is a strength, backed by positive recognition from Forbes and The New York Times for its influence in U.S. news.
However, the stock's drastic drop post-IPO and the concerns around legal risks and the sustainability of its business model suggest that investing in Newsmax remains speculative and risky at this point. The deceleration in Newsmax's sales growth rate and the lack of profitability are reasons to consider the investment in Newsmax stock risky.
It's important to note that Newsmax still has lingering risks related to judgments from outstanding civil suits involving the company. Moreover, the S&P 500 was up 0.2% at the same point in the daily session, indicating a more conservative market trend.
For conservative investors, Newsmax stock may not be a sound investment due to its high volatility and ongoing risks. Bold investors with high risk tolerance might find opportunity in its lower valuation, but the risks should be carefully weighed against potential rewards. The stock's performance could deliver substantial upside if the business demonstrates progress along key lines, but the current landscape suggests a risky investment.
Investing in Newsmax remains speculative and risky, given the stock's drastic drop post-IPO, concerns about the sustainability of its business model, and looming legal risks. The company's declining business model and lack of profitability further emphasize the risk associated with Newsmax stock. Despite the recent uptick driven by inclusion in the Russell 2000 index, the stock's high volatility and ongoing risks make it a questionable choice for conservative investors.
