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 Mead Johnson Nutrition (NYSE: MJN) plunged 10% on Thursday after Wal-Mart (NYSE: WMT) pulled a batch of its Enfamil baby formula from stores following the death of a Missouri infant who was fed the powdered formula.

So what: While a direct link between the death and Enfamil has yet to be found, investors are now fretting over possible worst-case scenarios including further pulls from Wal-Mart or even a full recall ordered by the government. Naturally, Mead Johnson sought to calm the market's nerves by assuring that the batch in question was, in fact, tested vigorously and found to be free of any bacteria when it was produced and packaged.

Now what: I wouldn't be so quick to pounce on this plunge. Whether justified or not, there's a real possibility that Enfamil sales will suffer from negative public perception even well after the issue is resolved. When you couple that nasty new headwind with the stock's already lofty P/E of 28, Mead Johnson seems like an easy pass.   

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.