Newsmax Surpasses Fox As Shares Surge Again

Topline

Newsmax is now more valuable than Fox Corp. after shares of the right-wing media company skyrocketed again on Tuesday, a market shift that nearly tripled the company’s market cap after a massive debut Monday.

Key Facts

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Big Number

$9.2 billion. That’s the estimated value of Newsmax CEO Christopher Ruddy’s 31% stake in the company as of Tuesday’s closing price. While Newsmax surpassed Fox’s market cap, Ruddy’s fortune likely still trails that of Rupert Murdoch, as the former Fox Corp. chairman has an estimated net worth of $22.5 billion.

Why Is Newsmax Surging?

Newsmax’s success appears to suggest there are more conservative investors than previously expected, Andersen Capital Management founder Peter Andersen told Reuters. Andersen said it’s “probably a perfect time” for Newsmax’s IPO, “simply because of all the volatility in the political arena currently.” Ruddy forecast the company’s successful debut in a statement to CNBC, suggesting consumers are paying more to watch channels from other networks as Newsmax’s fees for TV distributors to carry its network have increased in recent years.

How Does Newsmax’s Stock Compare To Other Media Companies?

Newsmax’s market cap exceeds valuations for The New York Times Company and CBS parent Paramount, which have $8.1 billion and $7.9 billion caps, respectively, as of Tuesday. The company is also more valuable than media companies Tegna and Sinclair, which together own nearly 250 local television stations, combined, with valuations of $2.9 billion and $1 billion, respectively. Right-wing media companies like Truth Social parent Trump Media and Technology Group and the video-sharing platform Rumble had similar initial public offerings. Trump Media shares surged 56% to $78 in their debut, which also featured several halts for volatility. The stock has remained largely volatile, surging to above $40 in January after dropping below $14 in September, as shares appeared to be linked to President Donald Trump’s election campaign. Rumble’s shares floated between $5 and $7 for most of 2024 before setting an all-time high $15.23 at year’s end.

Newsmax May Need To Pay Millions For 2020 Election Claims Soon

As Newsmax’s shares continue to soar in value, a jury trial is scheduled to begin April 28 for claims brought against the company by Dominion Voting Systems. Dominion, which accused Newsmax of pushing false claims about widespread election fraud on Dominion’s voting machines after the 2020 presidential election, is seeking about $1.6 billion in damages, according to CNN. The company will also need to pay off the remainder of a $40 million settlement with Smartmatic, which made similar allegations. Newsmax is scheduled to pay Smartmatic another $20 million in July, according to court documents.

Key Background

Newsmax raised about $75 million in its IPO while selling 7.5 million shares for $10 each. The company debuted with a market cap of about $1.2 billion, CEO Christopher Ruddy told CNBC, who suggested Newsmax would be a “growth stock,” later saying, “Americans for a long time have been voting with their remote controls, downloads, apps to say they want Newsmax.” The debut for Newsmax made Ruddy, who owns about 31% of the company, a billionaire, Forbes reported.

Further Reading

Newsmax Stock Skyrockets Over 700% Following IPO—Causing Multiple Trading Halts (Forbes)

Newsmax Founder Chris Ruddy Is A Billionaire Thanks To Stock Surge (Forbes)