Calix shares got hammered pretty hard on Friday after the company issued weak earnings guidance on the quarter. But investors might have been panicking about a whole lot of nothing.

In fact, more intrepid investors might look at why the earnings forecast were down: More R&D spending, possibly related to more big customers. But on Friday this did not matter, investors were in no mood for optimism. The earnings started out well enough: The company announced record revenues that were up 50% from the year-earlier period. In the pre-market, shares were up 10%.

Then the conference call came. The company gave revenue guidance of $70-$75 million and said earnings would only be in the 4 to 8-cent range. Most analysts had earnings of 14 cents or so. Most analysts were also expecting $80 million in revenue.

So, the stock was sold, and at one point traded below 10 on Friday. It closed the day at $10.45, near the bottom of its 52-week range (9-18).

This is probably the case of investors and traders reading a little too much into one earnings announcement. Calix is a fresh IPO (March 2010), so you need to take the long view with this stock. CEO Carl Russo has a lot of credibility with investors (though it's certainly not reflected in the stock), and anybody buying the stock has got to think this company will eventually be profitable with $1B in revenue.

One analyst we spoke with noted that the reason the earnings guidance was weak was because of some OSMINE compliance work that would only take place if the company were working on a deal with an ex-RBOC -- say, a Qwest?

"They talked about increased R&D spending but they strongly hinted that it was about business at Qwest."

With the company in the cusp of turning profitable for the year, it seems kind of silly to sell it on an EPS quidance for the third quarter. The big question for Calix is what it will do in 2011.Analysts are banking on $327 million in revenue and 60 cents of profit.

With a price/sales of 1.46, a market cap of $393 million (a little over 1x next year's revenue estimate), and $100 million in cash in the bank, it's a cheap stock.