Power meter maker Itron (ITRI) told the world that it missed its quarterly earnings results after the closing bell on Wednesday.  The company posted a profit of 45 cents a share, excluding special items, well below the consensus Street forecast for a profit of 50 cents per share.

Revenue fell 18% from the same quarter a year ago to $408.4 million. North American revenue was down 22%, and the company attributed the earnings and revenue declines to lower spending by customers who are still awaiting approval of projects that may qualify them for government stimulus funding.  

Itron shares fell sharply in Wednesday trade leading up to the earnings release, and they continued trading lower in the after hours session.

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Well, I don’t know if Wall Street got the memo, but the approval Itron’s customers have been waiting for is ever so close.  How close? This week, the big first round of the government smart grid sweepstakes came to an end, and guess which company stands to benefit hugely? That’s right, Itron.

On Tuesday the Obama administration named 100 utility projects that were awarded grants as part of the U.S. stimulus plan. The $3.4 billion smart grid investment grant awards will be matched by industry funding for a total public-private investment worth more than $8 billion.

As a leading maker of smart power meters—the infrastructure that enables two-way communication between customers’ meters and the utilities—Itron operates in the sweet spot of this smart grid build out.  The projects that include smart meters make up nearly $3 billion of the $3.4 billion total, and the Department of Energy (DOE) said grants of $400,000 to $200 million will lead to the installation of at least 18 million advanced digital meters, bringing the nation’s total to about 40 million, or enough meters to cover between 25% and 33% of U.S. homes.

These new meters are critical to utilities efforts to manage electricity demand because they will allow utilities to charge different rates at different times of day.  They also can be programmed to alert consumers when grid conditions require special action.  The ultimate goal of the stimulus grants are to boost efficiency across the electric-power grid, and Itron’s power meters are one huge key to making the grid smarter.

So given the Wednesday selling in both the regular session and the after-hours session, I think investors should be thanking their lucky stars that this stock has pulled back here.  This pullback in the shares below $58 is your chance to buy ITRI at what I think will prove to be a bargain-basement price.  I’m a buyer of the stock here, and I recommend it to anyone with an eye toward putting a smart meter in their portfolio.

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