Newsmax (NYSE: NMAX) experienced another significant drop in its stock price on Thursday, attributed to economic challenges and a negative court ruling. The company’s share value decreased by 26.8% during the day’s trading. The S&P 500 index also saw a decline of 3.5% as investors responded to unexpectedly high tariffs imposed on China. Additionally, Newsmax’s valuation was adversely affected by a court decision finding that the company had disseminated defamatory information against Dominion Voting Systems.
A Delaware Superior Court judge determined that Dominion successfully demonstrated that Newsmax had made false claims regarding the manipulation of votes by Dominion’s machines during the 2020 elections. Following the day’s trading, Newsmax’s stock is now down 69.5% from its market closing price on the day of its initial public offering (IPO) in late March.
Newsmax’s stock initially surged on its debut trading day, reaching as high as $265 per share during subsequent sessions. However, this increase was likely driven by meme-stock momentum, and the stock has since experienced significant declines amid recent broader market volatility.
Despite the current downturn, Newsmax is still up approximately 154% from its $10 per share IPO price; however, the stock is considered a risky investment at present. The media company reported a net loss of $72.2 million on sales of $171 million last year, and its performance may deteriorate without the support of election-related activities. Moreover, the defamation lawsuit filed by Dominion against Newsmax is heading to a jury trial, potentially resulting in a substantial settlement or judgment against the company.
