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.

Interested in more info on Lattice Semiconductor? Add it to your watchlist.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Motley Fool is investors writing for investors.