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What: Microchip Technology (Nasdaq: MCHP) dropped 14% in intraday trading today after it lowered guidance for the just-ended quarter and an analyst downgraded the stock.

So what: For its first quarter of fiscal 2012, which ended on June 30, management expects a sequential net sales decline of about 1.5%, non-GAAP EPS of $0.53 to $0.55, and GAAP EPS of $0.47 to $0.49. On May 5 it had guided to a sequential net sales increase of 1% to 6%, non-GAAP EPS of $0.58 to $0.62, and GAAP EPS of $0.52 to $0.55.

Now what: Management blamed the disappointment on several factors, including automotive sector weakness stemming from the tragedy in Japan, consumer weakness stemming from high gas prices and unemployment, and weak purchases from multiple large computer sector customers. The press release noted that the company continues to "see excellent design win traction in our microcontroller and analog product lines," suggesting it remains competitive in those areas. Nonetheless, the company said it is "cautiously modeling" its September quarter. Caris & Co. downgraded its rating on the stock to average from buy, while JPMorgan cut its price target from $36 to $29, maintaining its neutral rating.

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Fool contributor Cindy Johnson does not own shares of any company named above. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.