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Naive Query : The article mentions that it's a 21 percent premium to their present stock price. Can you throw some more light on why do you consider so ?

by hatred 12y ago

e98cuenc 12y ago
I'm not the author of the parent comment, but I read a couple years ago that Facebook opened a full datacenter that used Fusion IO disks, and I remember something like >$1 billion on Fusion IO disks alone. There are other big users, but I guess none as big as Facebook, and I don't really know how much money they were making, but the $1.1 billion also surprised me as quite low.
- crmd 12y ago
  FB uses Fusion-IO for text and metadata, not content. Most of their footprint is HDD.
TallGuyShort 12y ago
It feels shockingly low because it's so much less than we've been seeing for companies that seem less valuable.
- samstave 12y ago
  These guys should have made a mobile chat app instead of wasting all that time and money on something as mundane as dense, high-speed SSD storage. What were they thinking! /s
  - rossjudson 12y ago
    Yeah, things like http://www.fusionio.com/products/ion-accelerator#specs http://www.fusionio.com/products/ion-accelerator#specs, designed to be a (not so) mini-SAN.
phamilton 12y ago
That was my reaction too. I guess the stock valuation seems low too then. Hardware is expensive, especially high performance hardware. R&D is a minimum 3 years and 10 million dollars per product. 1.1B is roughly a 10x on a dozen products and that doesn't include all the other operating costs. I'm oversimplifying things, but this was the thought process that concluded with 1.1B seeming low.
- taylorbuley 12y ago
  I'm with you, and possibly for reasons beyond just the financials. If you look at the packaging, marketing and other variables (such as the likely customer of $22k/3TB of Flash) one gets the feeling that this is a very "premium" product and as such the company itself would also sell at such a premium.
RockyMcNuts 12y ago
All-time high was over 40, spent much of its lifetime trading in the 20s and 30s. Below IPO and secondary offering prices. Company has over $200m in cash, so less than $1b for a leading company in a high-growth market. Company raised maybe something like $450m between IPO, secondary, and pre-IPO rounds, so not a monster exit.
- tacticus 12y ago
  A leading company that just had intel announce them selves in the same market.
mbesto 12y ago
AFAIK - there's always a premium on a buy-out/purchase. I'll try to simplify as much as possible. If 100 people (shareholders) have 100 apples (outstanding shares) and the current market rate is $10 (stock price) each, it means that when someone wants to buy all 100 apples in one go, you can jack up the price (20% premium) because all of the people (shareholders) relinquish control and therefore give up their position for a premium. (there's way more nuances here, but basically this is what happens when supply is static and demand for totality exists)

Naive Query : The article mentions that it's a 21 percent premium to their present stock price. Can you throw some more light on why do you consider so ?

by hatred 12y ago

Naive Query : The article mentions that it's a 21 percent premium to their present stock price. Can you throw some more light on why do you consider so ?

e98cuenc 12y ago

I'm not the author of the parent comment, but I read a couple years ago that Facebook opened a full datacenter that used Fusion IO disks, and I remember something like >$1 billion on Fusion IO disks alone. There are other big users, but I guess none as big as Facebook, and I don't really know how much money they were making, but the $1.1 billion also surprised me as quite low.

crmd 12y ago
FB uses Fusion-IO for text and metadata, not content. Most of their footprint is HDD.

TallGuyShort 12y ago

It feels shockingly low because it's so much less than we've been seeing for companies that seem less valuable.

samstave 12y ago
These guys should have made a mobile chat app instead of wasting all that time and money on something as mundane as dense, high-speed SSD storage. What were they thinking! /s
- rossjudson 12y ago
  Yeah, things like http://www.fusionio.com/products/ion-accelerator#specs http://www.fusionio.com/products/ion-accelerator#specs, designed to be a (not so) mini-SAN.

phamilton 12y ago

That was my reaction too. I guess the stock valuation seems low too then. Hardware is expensive, especially high performance hardware. R&D is a minimum 3 years and 10 million dollars per product. 1.1B is roughly a 10x on a dozen products and that doesn't include all the other operating costs. I'm oversimplifying things, but this was the thought process that concluded with 1.1B seeming low.

taylorbuley 12y ago
I'm with you, and possibly for reasons beyond just the financials. If you look at the packaging, marketing and other variables (such as the likely customer of $22k/3TB of Flash) one gets the feeling that this is a very "premium" product and as such the company itself would also sell at such a premium.

RockyMcNuts 12y ago

All-time high was over 40, spent much of its lifetime trading in the 20s and 30s. Below IPO and secondary offering prices. Company has over $200m in cash, so less than $1b for a leading company in a high-growth market. Company raised maybe something like $450m between IPO, secondary, and pre-IPO rounds, so not a monster exit.

tacticus 12y ago
A leading company that just had intel announce them selves in the same market.

mbesto 12y ago

AFAIK - there's always a premium on a buy-out/purchase. I'll try to simplify as much as possible. If 100 people (shareholders) have 100 apples (outstanding shares) and the current market rate is $10 (stock price) each, it means that when someone wants to buy all 100 apples in one go, you can jack up the price (20% premium) because all of the people (shareholders) relinquish control and therefore give up their position for a premium. (there's way more nuances here, but basically this is what happens when supply is static and demand for totality exists)