Fusion-io Shares Jumped: What You Need to Know

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.

Interested in more info on Fusion-io? Add it to your watchlist by clicking here.

Fool contributor Evan Niu holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Intel and EMC. Motley Fool newsletter services have recommended buying shares of Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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