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: Oh, nuts! Shares of snack foods seller Diamond Foods (Nasdaq: DMND) were getting pummeled by Mr. Market today, falling as much as 16% in intraday trading.

So what: Last week, Diamond disclosed that its board is investigating concerns over "certain crop payments to walnut growers." The investigation concerned the company enough that it pushed the proposed closing date of the acquisition of the Pringles business from Procter & Gamble (NYSE: PG) until next year.

What's happened since then? Nothing directly from the company, but a Barron's article over the weekend helped stoke investor fears about what this means for Diamond -- including the potential for the P&G transaction to fall apart altogether.

Now what: Considering how little investors know about the situation behind the scenes at Diamond right now, it's pretty staggering that the stock's price has fallen nearly 40% since the day before the investigation was disclosed. Could this turn out to be something very serious that is highly detrimental to the company's long-term prospects? Absolutely. But I remain a bit skeptical that investors aren't overreacting at this point.

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