Newsmax's stock took flight immediately following its IPO, soaring as much as 2,230% by Tuesday. Yesterday, however, shares of Newsmax plummeted 77%.

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

Priced at $10 per share, the cable TV company closed its first day of open-market trading at $83.51 and its second at $233, after rising as high as $265. That left the stock NMAX up 2,230% in its first two days of trade on the New York Stock Exchange.

Newsmax's shares closed with a more-than-eight-fold gain at $83.51 on Monday, partly buoyed by retail interest.

Conservative cable network Newsmax (NYSE:NMAX) exploded onto the public markets on Monday, closing at $83.51—up a staggering 735% from its $10

Newsmax stock soared 1,236%, but overvaluation, net losses, and litigation risks make it a high-risk investment.