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 networking gear specialist Tellabs (Nasdaq: TLAB) plunged as far as 11.5% overnight on average trading volumes.

So what: Tellabs reported third-quarter earnings last night, beating bottom-line expectations with a $0.01 net loss per share but missing revenue targets by a country mile. Management blamed slow North American sales but remained enthusiastic about prospects abroad.

Now what: Tellabs counts AT&T (NYSE: T), Verizon (NYSE: VZ), and Clearwire (Nasdaq: CLWR) as its three largest customers, quarter in and quarter out, and the Americans just aren't building network infrastructure like they used to. The quicker these important clients get back to nuts-and-bolts investments instead of squabbling over merger deals or waiting for the economic headwinds to subside, the better for Tellabs. For now, this stock is lagging the Dow Jones (INDEX: ^DJI) index by a very wide margin in 2011 after losing 36% of its New Year's value. It's cheap -- but for good reason.

Interested in more info about Tellabs? Click here to add it to My Watchlist.

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