Your stock just took a nosedive -- but don't panic. First, let's see whether it had good reason to fall. Sometimes, panic-fueled drops can make excellent buying opportunities. Here's the latest crop of cratered stocks that could provide a possibility for profit:

Stock

CAPS Rating (out of 5)

% Chg

ImmunoGen (Nasdaq: IMGN)

***

(38.5%)

Skilled Health care Group (NYSE: SKH)

***

(13.2%)

Tiffany (NYSE: TIF)

**

(3.2%)

Source: wsj.com.

The devil's in the details
On a day when the market jumped 1.66%, last Friday's declines are big deals.

Nursing home operator Skilled Healthcare, already reeling from a $677 million judgment against it for safety code problems and improperly staffing its facilities, fell again when its effort to have a mistrial declared failed. Over the past 12 months, it has generated less than $770 million in revenue.

Tiffany's drop might have surprised some, considering that it posted earnings that surged 19% over last year, and also raised its full-year guidance. However, revenue missed expectations, and the company said third-quarter results will be "somewhat restrained" amid a gloomy economic outlook and constrained consumer spending. Investors in handbag maker Coach (NYSE: COH), another aspirational brand that has been doing well for itself, might want to take notice.

Don't bring me down
But the big news on Friday involved drugmaker Roche and the refuse-to-file letter it got from the FDA. That's tantamount to the agency asking, "Why did you even bother us with this?" Apparently, Roche didn't test its trastuzumab-DM1 (T-DM1) in the right population of patients. You'd think a pharmaceutical giant like Roche would have had the experience, know-how, and wherewithal to do it right.

Caught in the crossfire was biotech ImmunoGen, Roche's partner and the developer of the DM1 part of the drug candidate, whose shares were pummeled by the market. They dropped 35% on the news. ImmunoGen was set to receive royalties and milestone payments if T-DM1 won approval. Investors need to sort out whether the news was bad enough to justify its dramatic decline.

By most accounts, T-DM1 is a decent enough drug for breast cancer treatment. It's comprised of trastuzumab, an existing treatment of breast cancer that's marketed as Herceptin by Genentech (which was acquired by Roche), and a cell-killing agent developed by ImmunoGen. The accelerated application was based on midstage study results, but the FDA typically requires that to gain such approval, all other available treatment choices must first be exhausted. That wasn't the case here. T-DM1 will now have to finish going through phase 3 clinical trials before it can be considered for approval.

Therein lies the opportunity for investors. The submission has been delayed until at least 2012, during which time the drug will be put through its paces against a combination of Roche's Xeloda and GlaxoSmithKline's Tykerb.

Moreover, ImmunoGen has a pipeline of drugs and a passel of partners, including Biogen Idec (Nasdaq: BIIB) and sanofi-aventis (NYSE: SNY). It might not have any products on the market, and its earlier guidance might now be worsened, but drug developers like ImmunoGen are valued more on their potential.

For that reason, highly rated CAPS All-Star and biotech guru zzlangerhans says the big drop in price makes ImmunoGen a stock to consider:

The price drop today seemed excessive in that the FDA refusal simply represents a pipeline delay, albeit a long one. Given a long enough timeframe it seems inevitable that Immunogen will rise back toward 10 as T-DM1 and their other candidates continue to progress through slow oncology trials.

Ready for a resurrection
Just because your stock has taken a beating doesn't mean it's going to roll over and die. Markets are known for overreacting. A closer look at what's happened to your stock can give you an edge over other investors who just react to the market's lead.

That's why it pays to start your own research on these stocks on Motley Fool CAPS where you can read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from the stock's CAPS page. Then you can decide for yourself whether it's ready to come back from the dead.

Coach and Dolby Laboratories are Motley Fool Stock Advisor selections. GlaxoSmithKline is a Global Gains pick. The Fool owns shares of Coach and GlaxoSmithKline. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.