Why Fusion-io Shares Popped

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 Fusion-io (NYSE: FIO  ) jumped more than 16% Monday after two separate SEC filings showed executives purchased a large number of shares on Friday.

So what: For those of you keeping track, remember last Thursday shares of Fusion-io plunged more than 26% after the company beat earnings estimates but also provided weaker-than-expected forward revenue and margin guidance. As a result, it looks like management took advantage of the pullback in a big way.

Specifically, in addition to exercising outstanding stock options, Fusion-io Chief Legal Officer Shawn Lindquist just spent more than $104,000 to purchase 11,000 shares at just above $9.49 per share.

Even more impressive, Fusion-io CEO Shane Robison spent more than $1 million Friday to buy 105,500 shares at roughly $9.52 per share. 

Now what: Those are two pretty significant votes of confidence from the people running Fusion-io, so I can't help but wonder whether they were being conservative with their guidance while meaning to set up for another earnings beat going forward. After all, remember that guidance called for Q4 sales "to be up slightly sequentially" from $86.3 million, or far below the $114.26 million analysts expected at the time.

Still, that also assumes any given company's management is always right -- something truly Foolish investors need to be aware isn't always the case. As it stands, then, while this should make leery investors feel a bit better, I think it would be wise to approach shares of Fusion-io with caution.

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