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 Orthofix International (NASDAQ:OFIX), a medical device company specializing in spinal and orthopedic applications, shed as much as 21% of their value after the company reported its first-quarter results and received four analyst downgrades.

So what: For the quarter, Orthofix saw sales drop 14% to $100.3 million from the year-ago period as EPS declined by 66% to just $0.23. Its spine segment delivered a sales decline of 12% compared to a 17% decline from its orthopedics division with both experiencing significant weakness from international markets (e.g., Europe and Brazil). The Street had been expecting a profit of $0.66 per share on revenue of roughly $111 million in sales, so its results weren't even in the ballpark. Orthofix did authorize a $50 million share repurchase program, but that hardly made a dent with Mizuho, JMP Securities, Janney Capital, and Lazard Capital all downgrading the company. Looking ahead, Orthofix is forecasting second-quarter revenue of $104 million to $107 million, which is well below the $119.7 million that the Street had been projecting.

Now what: Yuck! If I were an analyst, I'd develop a special rating known as "Yuck" to quantify earnings reports like this. I understand that Europe is a challenging sales environment, but I'm having a hard time figuring out why Orthofix is struggling so much in Brazil. On top of that, CEO Brad Mason identified many of Orthofix's challenges as being internal, which to me signals that this isn't going to be a one-quarter event. Until we see demonstrable growth in sales and profits, I suggest looking elsewhere in the medical device industry.

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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.