The earthquake and tsunami in Japan on March 11 has caused a wave of panic in both the financial and humanitarian communities. Investors have reacted by selling off a plethora stocks related to technology and nuclear energy; conversely, they've scooped up stocks that rely on solar or wind power.

However, in the madness to divest portfolios, investors may be overreacting in certain sectors -- particularly semiconductors.

Not as bad as it may seem
Shares of many chipmakers have taken a beating in the past week or so, partly for good reason. The disaster will close plants, could disrupt supply chains, and might leave companies scrambling to fulfill inventory. In fact, Texas Instruments (NYSE: TXN) said this past Monday that one of its Japanese factories had been damaged, and that the particular plant in question generated about 10% of its 2010 revenues. That's certainly nothing to sneeze at. In addition, plants for Sony (NYSE: SNE), Toshiba, and Canon also reportedly closed. 

Moreover, in the beginning of the week, there was significant concern about NAND memory chips and a supply crunch as plants shut down under emergency conditions. To keep things in context, Japan accounts for one-fifth of the world's semiconductor production and about 40% of the flash memory chips that are used in almost every sort of electronic device.

However, it looks now like things may not be as bad as previously feared. NAND chip prices have eased 3.8% after an initial few days of surging, according to Reuters. Fool analyst Eric Bleeker feels that the initial reaction was much worse than necessary, and that the worst-case scenario isn't playing out as people thought. Check out his interview on CNBC Asia, where he explains why the impact of the Japanese earthquake won't be so terrible on chip companies.

Checking out cheap stocks!
In order to try and take advantage of some possible buying opportunities, I've screened for semiconductor stocks that have dropped significantly in the past few weeks, that are trading at reasonable valuations, and that have been highly rated by our Motley Fool CAPS investing community. Here are five stocks that I think are worth looking into:

Company

4-Week Price Change

P/E Ratio

CAPS Rating (out of 5)

Atmel Corporation (Nasdaq: ATML) (28.0%) 12.6 ****
RF Micro Devices (Nasdaq: RFMD) (23.5%) 13.6 ****
TriQuint Semiconductor (Nasdaq: TQNT) (19.9%) 10.1 ****
Marvell Technology (Nasdaq: MRVL) (18.4%) 11.5 ****
Cirrus Logic (Nasdaq: CRUS) (16.8%) 15.5 *****

Source: Motley Fool CAPS as of March 18.

The Foolish bottom line
Many of these stocks are pretty volatile in the first place (TriQuint, for instance, has a beta of 1.97). However, the events in Japan have only added to the turmoil, and thus these companies have seen their share prices fall. It's up to you to do your due diligence and see if the fall has been warranted; if not, this could be an absolutely stellar buying opportunity.

Interested in getting the latest commentary and analysis on the five stocks mentioned above? Click on the links below to add them to Your Watchlist.