Newsmax: The Trump Stock Surge

Ladies and gentlemen, buckle up! We're diving headfirst into the wild world of Newsmax, the conservative media giant that's taken Wall Street by storm. This isn't just any stock; it's a political powerhouse that's riding the Trump wave to unprecedented heights. Let's break it down!



The Trump Effect: Newsmax's Meteoric Rise

Newsmax's stock price has skyrocketed since its IPO in early 2025. The company priced its IPO at $10 per share, but the stock rocketed more than 700% on its first day of trading, closing at $83.51 per share. It continued soaring the next day, more than doubling again at one point and pushing its market capitalization to almost $17 billion. This eye-popping post-IPO spike has many investors wondering how they can buy the stock. This guide will show you how to invest in Newsmax stock and everything you need to know about investing in the media company.

How to Buy Newsmax Stock

As a publicly traded company, anyone can buy shares of Newsmax through a brokerage account or online trading platform. Here's a step-by-step guide on how to add the stock to your portfolio.

1. Open your brokerage app: Log into your brokerage account where you handle your investments.
2. Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
3. Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
4. Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
5. Submit your order: Confirm the details and submit your buy order.
6. Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.

Should You Invest in Newsmax?

Before logging into your brokerage app to buy shares, you should first consider whether Newsmax is the right stock for you to buy. Here are some reasons why you might want to invest in Newsmax:

- Conservative Values: You want to invest in a company that promotes conservative values.
- Growth Potential: You believe the stock will continue to gain value as Newsmax grows its revenue and eventually starts making money.
- Volatility: You're comfortable with buying a stock that could be very volatile.
- IPO Risk: You understand the risks of investing in an IPO stock that's not yet profitable, including the fact that you could lose most or all of your investment if it can't turn the corner on profitability.
- Valuation: You think Newsmax can grow into its valuation, which was almost 100 times its revenue in early 2025.
- No Dividends: You don't need dividend income right now.

Conversely, here are some reasons why investing in Newsmax might not be right for you:

- Value Mismatch: The values Newsmax promotes don't line up with yours.
- Retirement Needs: You're in or nearing retirement and need investments that produce dividend income.
- Financial Concerns: You're concerned about Newsmax's financials, including the fact that it's losing a lot of money.
- Volatility: You don't want to invest in what could be a very volatile stock.
- Additional Shares: You're worried that Newsmax stock could fall significantly if it sells additional shares following its IPO to raise more cash to fund its business.

Newsmax's Financials: The Good, the Bad, and the Ugly

Profit growth tends to be the primary factor that drives a stock's performance over the long term. With that in mind, here's a look at Newsmax's finances.

Newsmax has several revenue streams. In 2024, the company generated $171 million in revenue from the following activities:

- Advertising: $109.2 million, a 2% increase from 2023.
- Subscriptions: $26.9 million, up 50% from the prior year.
- Affiliate fees: $26.7 million, a more than 1,000% increase from 2023.
- Other: $2.3 million, up nearly 125%.
- Product sales: $6 million, down by almost 7%.

However, after factoring in expenses, the company reported a net loss of $72 million. That was almost 73% more than it lost the prior year, despite a 26% rise in revenue. Meanwhile, the company's business burned through cash last year. It used $48.7 million in cash to support its operating activities and another $58.4 million for investing activities.

Because its business is consuming cash, Newsmax had to raise capital from investors. It launched a private offering to sell up to $225 million of convertible preferred stock while awaiting its IPO. Its IPO raised another $75 million in cash to help fund Newsmax's operations and growth.

Newsmax won't be able to rely on investors to fund its business in perpetuity. The company will eventually need to reach profitability so that it can use its retained earnings to fund its growth. The longer it takes the company to start making money, the more pressure it could put on the stock price.

The Trump Factor: A Wild Ride Ahead

The return of Donald Trump to the White House sets the scene for a wild ride on financial markets over the next four years. There has already been plenty of activity since the Republican defeated his Democratic rival Kamala Harris in the November elections. Bitcoin - one of the big ‘Trump trades’ due to the returning President’s newfound support for cryptocurrency - soared past $100,000 for the first time in the weeks after his victory.

The dollar is on the march and the bond markets are in turmoil - as anyone who has seen the sharp fall in sterling and surge in UK borrowing costs in recent weeks will know. At the same time, stock markets are on the rise with even the seemingly unloved FTSE 100 hitting a record high on Friday.

So, what now for the markets, and how can investors protect themselves - or even profit - from the turmoil? Donald Trump's return to the White House – and what he will do in areas such as tariffs and trade as well as tax and spending – is at the forefront of investors’ minds.

The threat of Trump's tariffs Global events - including geopolitical tensions between China and the West as well as war in Ukraine and tension in the Middle East - will of course play their part. So, too, will central banks as they decide how far to cut interest rates in the battle against inflation. But it is the return of Trump – and what he will do in areas such as tariffs and trade as well as tax and spending – that remains at the forefront of investors’ minds.

‘We are looking at a wild four years ahead,’ says Chris Weston, head of research at City trading firm Pepperstone. Russ Mould, investment director at AJ Bell, says the threat of tariffs are hanging over the global economy. ‘In theory, one way to try to find winners could be to find UK-listed firms that have a big base in America and sell a lot there from those US-based operations,’ he notes. ‘Another option is to hide away and look for firms that have no US exposure and operate solely in the UK or another country.’

If Trump does launch tariffs, and they push up inflation, Mould believes ‘perceived stores of value’ such as precious metals such as gold and silver and precious metals miners may prove a fruitful investment. ‘We are looking at a wild four years ahead,’ says Chris Weston, head of research at City trading firm Pepperstone. ‘All of this will depend upon what Trump tries to do, does do, what the effects are, and what policy response, if any, is provoked elsewhere - and then what investors think may happen and how that compares to what is already priced in,’ adds Mould.

David Morrison, senior market analyst at Trade Nation, reckons the FTSE 100 index could be one of the big winners over the next four years. He believes the dollar will weaken and the surge in the value of US technology stocks - including the so-called ‘Magnificent Seven’ of Apple, Amazon, Google owner Alphabet, Tesla, Nvidia, Microsoft and Meta - may have run its course. This will leave investors looking for somewhere else to put their money - with the undervalued London stock market a potential beneficiary.

‘I expect this dollar strength to start to diminish after Donald Trump’s inauguration,’ says Morrison. ‘I think that the financial world’s obsession with US exceptionalism in terms of its economic strength will start to diminish. 'I think that investors will wake up to the lack of breadth in the US stock market, with the overvaluation of the tech titans, which have done all the heavy lifting in driving US stock indices to record highs in 2024, becoming apparent. ‘Bond yields will pull back as investors push the Fed to cut rates aggressively to stem a falling stock market and dollar-denominated commodities and the companies that mine them, will be back in demand. If so, this dynamic may even help our dear-old FTSE 100 spring back from the dead..’

Amid the uncertainty, we asked Wall Street and City experts for tips on where to invest with the return of Trump. They have offered investment ideas for brave investors who are willing to take a risk as well as tips for the more cautious. Shares and other investments can go down in value as well as up, and following tips always involves the risk of losing some or all of your money, so it’s a good idea to do your own research before investing.

The Bottom Line

Newsmax is a high-risk, high-reward stock that's riding the Trump wave to new heights. If you're comfortable with volatility and believe in the company's growth potential, it could be a lucrative investment. But be prepared for the roller coaster ride that comes with investing in a stock that's as politically charged as Newsmax.

So, are you ready to jump on the Newsmax bandwagon? Or will you sit this one out and wait for the dust to settle? The choice is yours, but one thing is for sure: Newsmax is a stock that's making headlines and shaking up the market. Don't miss out on this opportunity to be part of the action!