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 Lattice Semiconductor (Nasdaq: LSCC) are dropping as low as 10% below last night's closing price.

So What: Programmable logic rival Xilinx (Nasdaq: XLNX) was downgraded by analysts today because of competitive pressures and weak cash flows. The market appears to take that action as a general sign of industry weakness, and is punishing Lattice ahead of tonight's earnings report.

Now What: Lattice is trading at less than nine times forward earnings, not to mention sitting on $1.81 of debt-free cash per $4.41 share. Barring a major disaster in that earnings report, this looks like a mighty compelling time to buy an undervalued stock. But don't just take my word for it; Lattice recently climbed to a desirable four-star rating (out of five) in our CAPS system, meaning that your fellow individual investors tend to agree with that positive assessment.