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 unmanned vehicle maker AeroVironment (NASDAQ:AVAV) fell as much as 22% in early trading after releasing its fiscal third quarter earnings report.

So what: Revenue fell 34.6%, to $47.1 million in the quarter, which was well below the $89.2 million analysts expected. On the bottom line, profit fell from $5.7 million a year ago, to $3.9 million, or $0.17 per share, which was less than half of the $0.37 estimate from Wall Street.  

Now what: There was about $100 million of revenue that slipped from fiscal 2013 to fiscal 2014, according to management. That resulted in this quarter's weakness, and a fiscal forecast that was more than $100 million below its previous estimate. Slower than expected government spending is accounting for most of the miss, and I don't expect that pressure to ease up. Long-term, I think the company is a good business, but until the stock is a screaming buy, I'm going to sit on the sidelines. I think there's still 25%+ of downside as the market adjusts expectations.

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