Looking back at the market meltdown of 2008 and early 2009, many investors wish they had had more courage to buy at what now seem to be once-in-a-lifetime levels. Yet those same investors may have exactly that second chance -- if they're willing to look across the Atlantic to find beaten-down stocks at Armageddon-like levels.

Europe faces its own storm
Three years ago, the U.S. was the epicenter of the financial crisis that caused domestic stock markets to melt down so far. Because of the nation's status as the world's largest economy, stocks around the world followed their U.S. counterparts downward, but to a large extent, the fears foreign investors faced had to do with possible collateral damage that the American crisis could have caused -- fears that largely proved unfounded.

Now, though, Europe faces its own crisis, as the fiscal problems across the southern tier of the eurozone threaten the viability of the continent's common currency. The French stock market has already given up all of its gains since April 2009, while the German market is at its two-year low and Italian stocks are well below their early 2009 levels.

Clearly, the severity of the problems Europe is dealing with is just as bad as what the U.S. had to overcome in 2008 and 2009. But unless you have some reason to believe that Europe will be less successful in at least deferring the full impact of its problems into the future, then it's reasonable to conclude that shares are undervalued now and could rebound sharply if anything short of a complete breakup of the European Union ends up happening.

Stocks are cheap
Meanwhile, it's easy to find good European stocks offering a variety of attractive traits. Consider the following:

  • If you like high dividend yields, you'll find plenty of attractive payouts from European stocks. France Telecom (NYSE: FTE), Telefonica (NYSE: TEF), and Portugal Telecom (NYSE: PT) all pay 10% yields or more at current prices, and while they have unquestionable exposure to the European economy, they also have prospects beyond the continent. Even U.K.-based Vodafone (Nasdaq: VOD), which isn't as directly exposed to the euro as its continental competitors, carries a dividend yield of more than 5%.
  • Closed-end funds specializing in European countries have also gotten very cheap. New Germany Fund (NYSE: GF) and Swiss Helvetia Fund (NYSE: SWZ) both trade near their 52-week lows, with discounts to their net asset values that make them even more attractive. Meanwhile, New Ireland Fund has actually come off its lows, but it still trades at more than a 10% discount to NAV.
  • Even broad-based European funds like Vanguard MSCI European ETF (AMEX: VGK), which include stocks from countries across the continent, offer values that investors haven't seen in years.

Now it's true that there's no guarantee that Europe will pull out of its tailspin the same way that the U.S. did in early 2009. The situation is far different, primarily because Europe isn't a single nation that can work relatively seamlessly to address the problem. With multiple nations having to cooperate through a European Central Bank that doesn't have the same resources and abilities as the Federal Reserve, Europe's eventual solution will likely look quite different from what we saw in 2009.

Nevertheless, value investors know that buying opportunities never look obvious at the time. There's always a good reason not to pull the trigger and buy -- but that won't stop you from slapping yourself later after the turmoil has ended and you've missed out on a big gain.

Don't stop looking
If you've been waiting for stocks to give you the same values they did a few years ago, it's time to start turning your attention to Europe. The answer isn't simply to buy anything and everything European. But using the same disciplined investing approach you use for U.S. stocks, you can identify the best investments for your portfolio and pick them up for a song. And maybe after it's all said and done, the profits will let you take a nice trip to see the source of all your success!

If you think stocks are poised for a recovery, you won't want to miss the international ETF that will prosper from it. Take a look at the Fool's special report on ETFs set to soar in a recovery and get two great U.S. names as well.

Tune in every Monday and Wednesday for Dan's columns on retirement, investing, and personal finance. You can follow him on Twitter here.