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 Peet's Coffee (Nasdaq: PEET) were badly in need of a java jolt today as they slumped as much as 15% after Starbucks (Nasdaq: SBUX) signed an agreement to offer single-serve coffee through Green Mountain Coffee Roasters' (Nasdaq: GMCR) Keurig single-cup brewers.

So what: Like that morning cup of coffee you accidentally put salt in, this deal has got to taste terrible for Peet's. It was widely thought that the company was ready to sign its own deal with Green Mountain. In fact, an analyst at Janney Capital raised his rating on Peet's in anticipation of a pact. After today, though, there's little hope that a deal will be struck, and over at Janney the stock has been cut from a "buy" all the way to a "sell."

Now what: Looking at the big picture, Peet's success certainly didn't hinge on a single-serve deal with Green Mountain Coffee. The company is solidly profitable, has grown well over the years, and is still in a position to do well on its own. As is so often the case, though, expectations are the problem. To the extent that investors had already baked a Green Mountain deal into Peet's stock price, there's good reason for a sell-off. And to be sure, with the stock trading at 27 times expected 2011 earnings after today's dip, Peet's stock is already priced for a pretty rosy future.

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Peet's Coffee & Tea is a Motley Fool Big Short short-sale recommendation. Green Mountain Coffee Roasters is a Motley Fool Rule Breakers choice. Starbucks is a Motley Fool Stock Advisor selection. Motley Fool Alpha has opened a short position on Green Mountain Coffee Roasters. Motley Fool Options has recommended a buy puts position on Green Mountain Coffee Roasters. The Fool owns shares of Starbucks. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or on his RSS feed. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.