Standard & Poor’s Equity Research downgraded optical equipment maker Sycamore Networks from “hold” to “strong sell” Thursday, citing the company’s long, murky path to profitability.

“We do not see Sycamore making a profit for the next two years, or possibly longer,” S&P said, adding separate concerns about the vendor’s corporate governance, calling its stock option policy “excessive given our view of its operational challenges.”

A Sycamore spokesperson said the company does not comment on analyst ratings. Regarding its stock option policy, the spokesperson pointed out that the number of outstanding options has declined over the past three and a half years.

Sycamore began retaining Morgan Stanley to help it review “strategic alternatives” in August 2004. In February 2005 the company reported a $5.3 million loss for the second fiscal quarter of 2005 and a cash burn of $8.8 million, which left it with $949 million in cash and equivalents. Quarterly revenue was up 5% sequentially and 116% year-over-year to $14.9 million, about a fourth of which came from maintenance services.