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Europe's day of reckoning is coming. After decades of making too many promises to too many people and bailing out financial institutions that otherwise should have perished, public debt has ballooned beyond what many economists consider the point of no return.

Whether the PIIGS end up defaulting on their debt or enduring years and years of painful austerity, one thing is for certain: its debt overhang will be a major drag on economic growth for quite some time. Not only will higher interest payments and reduced government spending hinder GDP growth, higher taxes and reduced consumer confidence will lower consumption too.

Collectively, the EU is the world's second largest economy, so this doesn't bode well for the rest of globe. Of course Europe has been in slow growth mode for quite some time now, so more anemic growth might have a relatively muted impact on the rest of the world.

But there are certainly many outside of Europe that would feel the brunt of an economic slowdown there. Shares of teen retailer Abercrombie & Fitch (ANF) recently plummeted after the company reported disappointing sales figures due in large part to negative same-store sales in Europe. Approximately 19% of its overall sales come from there.

What are some other U.S.-based companies currently relying on a healthy European economy? Here are 4:

Guess? (GES - Analyst Report)

Europe is the company's largest segment and accounts for over 39% of total revenue. The continent has actually been a huge growth driver for the company over the last several years while sales have been rather sluggish here in the States. But if European consumers cut back, it could be spell big trouble for Guess?.

First Solar (FSLR - Analyst Report)

Let's face it - solar panel companies like First Solar rely heavily on big government to force the invisible hand of the market. But the beast has become bloated and solar panels could be one of its many casualties. That would be devastating for First Solar since 74% of net sales came from the European Union in 2010. Germany alone accounted for 46% of sales and is First Solar's largest market. And in the U.S., the company's biggest market is California, another nanny state in dire financial straits. Look out.

McDonald's (MCD - Analyst Report)

The Golden Arches is one of the most recognizable brands in the world. Believe it or not, European citizens, and not Americans, are McDonald's biggest customers (no pun intended). Over 40% of revenue comes from there, compared with 32% in the U.S. So far this year Europeans have been lovin' their McDonald's. But a big drop in consumer spending could hurt Micky D's bottom line.

Activision Blizzard (ATVI - Snapshot Report)

This video game maker is headquartered in Santa Monica, California but relies on Europe for over 40% of its revenue. Although revenues there are up 23% year-to-date, rising unemployment, stagnant wages and lower consumer confidence could cause Europeans to cut back. That could squeeze profits and send shares plummeting.

The Bottom Line

Europe's fiscal mess isn't going away anytime soon, and painful but necessary austerity measures will remain a drag on GDP for years. Investors might want to think about avoiding companies who rely on the continent for a big chunk of their business.

Todd Bunton is the Growth & Income Stock Strategist for Zacks Investment Research and Co-Editor of the Reitmeister Value Investor.

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