Better Media Stock: Newsmax vs. Trump Media

President Donald Trump's ascent to the White House helped draw interest to shares of Newsmax (NYSE: NMAX) and Trump Media & Technology Group (NASDAQ: DJT). After all, he encouraged followers to watch the former, and the latter sports his name.

Conservative news outlet Newsmax is the newer public company of the two. Its initial public offering (IPO) took place in March. Trump Media isn't too old, either. It began trading in 2024.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Of these two media businesses, one stands out as a superior stock investment over the other. Digging into each in more detail will reveal which one and why.

Image source: Getty Images.

Newsmax's pros and cons

In the era of digital content and cord-cutting, Newsmax does well, even though its news and other media are broadcast on linear television and radio. It also produces a print magazine.

The company delivers digital media, as well, such as via its Newsmax+ streaming app. But its old-school approach resonated with viewers. Newsmax reported a 50% year-over-year increase in its audience in April. The growth helps the company charge higher advertising rates.

This is important since ads represent the bulk of its income. In Newsmax's initial earnings report as a public company, $28.9 million of its $45.3 million in first-quarter revenue came from advertising. Higher broadcast ratings allowed the company to increase Q1 ad revenue, enabling total sales to grow 12% year over year.

Despite a solid quarter, the company isn't profitable. Its Q1 net loss was $17.2 million. That said, the result was a substantial reduction from 2024's net loss of $50.7 million, illustrating the company's progress toward profitability.

A look at Trump Media

Trump Media is working to build up its business through three main avenues. These include the social media site Truth Social, its Truth+ streaming video service, and a new Truth.Fi financial brand.

Currently, the company generates nearly all its revenue from advertising through Truth Social. In Q1, sales were $821,200, compared to $770,500 in 2024.

Trump Media plans to expand its horizons by investing in Bitcoin. To raise the funds to do so, the company sold 55.9 million additional shares to institutional investors, as well as convertible senior secured notes due in 2028 to generate $2.3 billion in net proceeds.

According to the company, the proceeds from this will enable Trump Media to become "one of the top Bitcoin holders among publicly traded U.S. firms."

However, like Newsmax, Trump Media isn't profitable. Its Q1 net loss came in at $31.7 million. The result suggests that the company's potential to eventually turn a profit is bleak, considering this is nearly double Newsmax's $17.2 million Q1 loss, yet Trump Media's sales in the quarter could not break $1 million.

The situation means Trump Media desperately needs to find new revenue streams or its Bitcoin strategy has to pay off. Otherwise, the company could go bankrupt, which was the fate of Trump's previous publicly traded business, Trump Hotels and Casino Resorts, in 2004.

Choosing between Newsmax and Trump Media stocks

Deciding whether to invest in Newsmax or Trump Media shares involves weighing a few other factors. Although Newsmax grew Q1 revenue year over year, a Delaware judge has already ruled that Newsmax aired false claims about Dominion Voting Systems regarding the company's voting machines and the 2020 election, and Dominion will now seek up to $1.6 billion in damages in a defamation trial.

Given the substantial sum involved, if Newsmax loses, the company stated the case "could have a material adverse effect on Newsmax's financial position." The broadcaster previously settled another defamation case brought by Smartmatic, another voting systems vendor, for $40 million.

Turning to Trump Media, it has a massive Achilles' heel: A single unidentified customer is responsible for 93% of Q1 advertising revenues. Such a concentration in a single customer leaves Trump Media on unsteady footing.

One final consideration is stock valuation. This can be assessed using the price-to-sales ratio (P/S), which tells you how much you're paying for every dollar of revenue a company earned during the trailing 12 months. This metric is commonly used to evaluate stocks for unprofitable businesses, such as Newsmax and Trump Media.

Newsmax's P/S multiple is 10 as of June 30, while Trump Media's is nearly 960. This indicates that Newsmax is the better value. Trump Media shares appear to be overpriced, given the sky-high P/S ratio.

Considering its revenue growth, shrinking net loss, and superior stock valuation, Newsmax is the clear winner between these two media companies. Even so, given the potential impact of the Dominion trial, you may want to wait until the legal dust settles to consider buying shares.

Should you invest $1,000 in Trump Media & Technology Group right now?

Before you buy stock in Trump Media & Technology Group, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Trump Media & Technology Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $722,181!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $968,402!*

Now, it’s worth noting Stock Advisor’s total average return is 1,069% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Robert Izquierdo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.