The realization that Europe really is on the precipice drove markets down yesterday. Although your stock took a nosedive, don't panic. First, let's see whether it had good reason to fall. Sometimes, panic-fueled drops can make excellent buying opportunities. Here's the latest crop of cratered stocks that could provide a possibility for profit.

Stock

CAPS Rating (out of 5)

Tuesday's Change

MF Global (NYSE: MF) *** (47.6%)
Netflix (Nasdaq: NFLX) ** (34.9%)
First Solar (Nasdaq: FSLR) ** (25.3%)

With the Dow Jones Industrial Average (NYSE: ^DJI) tumbling 207 points yesterday, or 1.7%, stocks that went down by even larger percentages are pretty big deals.

Out of the frying pan, into the fire
It might be easy (and fun) to point to Jon Corzine's stint as CEO of MF Global as comparable to his tenure as governor of New Jersey, but the former Goldman Sachs (NYSE: GS) executive faced a financial situation more difficult than most over the past few decades -- save the global financial meltdown itself in 2008. It just so happens that MF's stock meltdown was the worst since then, too, and as of yesterday, it had lost about 75% of its value since Corzine took the helm last year.

In trying to turn the futures trader into a mini-Goldman or a Morgan Stanley clone, Corzine exposed the firm to the dicey situation in Europe: MF Global said it still has about $6.3 billion in net exposure to European sovereign bonds. With even Alan Greenspan predicting that the EU is doomed to failure because the divide between countries is too great, the risks for MF mount.

Yet beyond the EU crisis, the investment house has other problems to contend with, all of which led to revenues plunging 14% and a net loss of $0.09 per share excluding large one-time charges, far worse than the $0.04-per-share profit analysts had been expecting. Ratings agency Moody's downgraded MF to just one step above junk status yesterday.

Like many investors, CAPS All-Stars thought Corzine's star power and Wall Street savvy would turn MF Global around, which is why 89% of those members rating the trader thought it would outperform the market. You can tell us on the MF Global CAPS page or in the comments section below if you think shareholders follow New Jersey voters' example and send the CEO packing, or see whether it can still turn things around by adding it to the Fool's portfolio tracker.

A drama of epic proportions
It turns out Netflix's situation is worse than we thought, and the market's reaction to the news amounts to a huge vote of no confidence in CEO Reed Hastings. Sure, investors can get overly emotional and sell their stock with their hearts and not their heads, but the hemorrhaging of subscribers from the movie-rental king continues unabated and indeed seems to be picking up steam.

Despite quickly killing its poorly thought-out plan to create separate rental and streaming companies (with the latter to have the silly name Qwikster), Netflix has stuck to its guns on raising prices for the services. Hastings says the future is streaming, and he's placing the company at the forefront and won't lift a finger to lure fleeing subscribers back. He's sticking to his guns no matter what.

Such hubris will probably allow rival Amazon.com (Nasdaq: AMZN) to gain ground in the space and has already permitted Coinstar (Nasdaq: CSTR) and even bankrupt Blockbuster an opportunity to cash in on the debacle.

At some point, though, the beatdown becomes too severe and the stock is too cheap to ignore, a point CAPS All-Star rws1773 says Netflix has reached: "In the end though, I believe that Netflix will continue to innovate and lead the way. I may be wrong and they may get swallowed up by Apple or Amazon, but at the current valuation, it's a risk I believe is worth taking."

Add Netflix to your watchlist, and let us know in the comments section below whether you think Hastings needs to go or whether he has the situation exactly right.

The sun's going down
Another CEO who made all the wrong decisions for his company was Rob Gillette at First Solar, who set about to double the solar shop's capacity only to see facilities sit idle and employees face massive layoffs because of an industry glut. Whether Gillette jumped or was pushed, though, First Solar announced that he was no longer in charge "effective immediately," and the stock went down with him.

Everyone likes to point to Chinese subsidies as the factor killing U.S. solar businesses, from First Solar to Solyndra, as if subsidies are a good thing our government needs to emulate and don't distort the marketplace. There are mounting losses on the Chinese side as well, and it will only go on for so long before the Chinese government draws the line on how much it's willing to underwrite. The damage on the other side of the Pacific will undoubtedly be deeper and more pronounced than what we're seeing here.

Shares of other solar businesses followed First Solar down, though not as dramatically. ReneSola (NYSE: SOL) was down 10% and SunPower was off 9%, while the entire CAPS Solar Power sector fell almost 6% on the day.

Highly rated CAPS All-Star TSIF takes a more opportunistic view of First Solar's situation in rating the solar specialist to outperform from here.

I have NO faith in the solar industry currently with the glut on the market now and the current issue that without subsidies it is still not competitive.

Still a 25% haircut on top of the 65% yoy decline before this recent cut seems excessive for a CEO leaving. The fact he left a day or so prior to earnings and the other officers leaving the company, however are indeed a concern.

Add First Solar to the Fool's free portfolio tracker to keep abreast of developments and see if it will ever find its way out of the wilderness, and see what others are saying on the First Solar CAPS page.