For several quarters, investors have parsed remarks by the major optical networking equipment makers for any hint of a bottom. Today, Ciena's(Nasdaq: CIEN) Chief Executive Officer Gary Smith let it all hang out, when he reportedly said on the company's conference call, "We'd like nothing more than to say the worst is over, but it's not clear we're there just yet.''

Yes, the floor keeps dropping for his company -- and its competitors. Ciena announced that Q3 revenue plummeted to $50 million from a year-ago $458 million. Down 89%. Yet Ciena finished the quarter with $1.30 billion in cash and short-term investments. That's a huge wallet, but investors are watching the cash burn -- $68 million, sequentially.

Here are the last five quarters' revenues and cash and equivalents for Ciena and two other optical gear makers:

          Ciena      JDS Uniphase   Avanex 
     Revs.     Cash Revs. Cash  Revs. Cash
Q3*  $50 mil. $1299 $222  $1450 $ 8 $136
Q2    87       1368  262   1564  10  153
Q1   162       1523  286   1653   8  160
Q4   368       1300  329   1754   7  195
Q3   458       1398  601   1812  18  204
*or company's equivalent quarter

All three are watching revenues tumble and cash decline. Ciena shares closed yesterday at $4.49 a share, 9% above its $4.13 a share in cash and short-term investments net of debt. JDS Uniphase(Nasdaq: JDSU) finished at $2.40, with about $0.96 per share in cash, and Avanex(Nasdaq: AVNX) ended at $2.38, with $2.12. If cash burn were to end, these cash-rich, almost debt-free companies would suddenly have vastly improved margins of safety. They may not be the best businesses, but if they had no cash burn and maintained their substantial reserves, they would have terrific upside. Investors who want to examine companies selling at or close to cash per share may want to look into the concept of net net working capital, explained by Matt Richey in Quest for Deep Value.

None of these companies is anywhere near a value stock yet -- though if you really understand the industry, you may know something others don't. Please share it on the Ciena discussion board. But the market is assigning odds that these companies may fail, and a little studying might send you in the direction of some intriguing possibilities.