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 chip designer Standard Microsystems (Nasdaq: SMSC) plunged as much as 10.6% today on triple the average trading volume.

So what: The company reported earnings this morning, which beat expectations senseless. A highly dilutive buyout of smaller chip wrangler Conexant Systems (Nasdaq: CNXT) explains the negative action.

Now what: Conexant seems stuck in the 1990s with fax modem chips and low-cost audio solutions. Why Standard Microsystems wants to buy this increasingly obsolete mess is beyond me. If the high-quality earnings report hadn't saved the day, today's drop could have -- should have -- been a lot steeper.

Interested in more info on Standard Microsystems? Add it to your watchlist.