February 17, 2012
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of solid-state specialist Fusion-io (NYSE: FIO ) have jumped by more than 19% today on renewed takeover speculation.
So what: As the pioneer of innovative storage architecture, Fusion-io is no stranger to takeover talk. There is questionable talk that Intel (Nasdaq: INTC ) may be interested, and CNBC even speculated that a potential offer could reach as high as $40, well above even today's high price of $29.74. The company issued a brief press release saying it doesn't comment on market activity.
Now what: Storage rival EMC (NYSE: EMC ) recently introduced VFCache, whose design follows in Fusion-io's footsteps, which validates the smaller company's unique approach but also partially reduces the chances that EMC would try to acquire Fusion-io anytime soon since it now has a similar offering. There's a distinct possibility that Fusion-io may someday get acquired by a larger company seeking to integrate its technology, but it's doubtful it will happen anytime soon considering its hefty valuation and narrow profitability.
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