Fusion-io (FIO) Valuation, Technology Might Attract Buyers
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Fusion-io (NYSE: FIO) shares ended lower amid speculation that the company's now record-low price-earnings ratio might attract a few suitors.
According to Bloomberg-compiled data, Fusion-io has slumped to a P/E ratio of 3.1 times following the abrupt departure of CEO David Flynn and co-founder Rick White last month.
Potential buyers include NetApp (Nasdaq: NTAP), Hewlett-Packard (NYSE: HPQ), and possibly Oracle (Nasdaq: ORCL), among others.
Hewlett-Packard might be the most logical buyer and already uses Fusion-io technology in products it sells. The company has to complete its current turnaround first.
NetApp might acquire the company to gain its flash memory, which is said to be cutting edge technology. The company also has Elliott Management looking to pressure it into returning more value to shareholders which a key acquisition might do.
Given that Fusion-io is expected to increase sales by over 102 percent over the next three years, a buyer might have to pay-up to persuade incoming CEO Shane Robison to sell the company, which certainly won't happen in a flash.
According to Bloomberg-compiled data, Fusion-io has slumped to a P/E ratio of 3.1 times following the abrupt departure of CEO David Flynn and co-founder Rick White last month.
Potential buyers include NetApp (Nasdaq: NTAP), Hewlett-Packard (NYSE: HPQ), and possibly Oracle (Nasdaq: ORCL), among others.
Hewlett-Packard might be the most logical buyer and already uses Fusion-io technology in products it sells. The company has to complete its current turnaround first.
NetApp might acquire the company to gain its flash memory, which is said to be cutting edge technology. The company also has Elliott Management looking to pressure it into returning more value to shareholders which a key acquisition might do.
Given that Fusion-io is expected to increase sales by over 102 percent over the next three years, a buyer might have to pay-up to persuade incoming CEO Shane Robison to sell the company, which certainly won't happen in a flash.
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