Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, interconnection services specialist Neutral Tandem (Nasdaq: TNDM) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Neutral Tandem's business and see what CAPS investors are saying about the stock right now.

Neutral Tandem facts

Headquarters (Founded) Chicago (2001)
Market Cap $514.34 million
Industry Wireless communications
Trailing-12-Month Revenue $180.77 million
Management

CEO Rian Wren (since 2006)

CFO Robert Junkroski (since 2003)

Return on Equity (Average, Past 3 Years) 17.2%
Cash/Debt $204.8 million / $0
Competitors

AT&T (NYSE: T)

Qwest Communications (NYSE: Q)

Verizon Communications (NYSE: VZ)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 98% of the 1,087 members who have rated Neutral Tandem think the stock will outperform the S&P 500 going forward. These bulls include ERSAFFER and All-Star btown819, who is ranked in the top 5% of our community.

Late last year, ERSAFFER tapped Neutral Tandem as a cheap way to go for growth: "[G]reat sector, room to grow, been tracking this for some time and it has been beaten down recently. [G]ood buy in time."

Currently, Neutral Tandem even boasts an EV/EBITDA of 4.2, representing a discount to traditional local exchange carriers AT&T (5.9), Qwest (5.9), and Verizon (4.8), as well as other carrier foes like Level 3 Communications (Nasdaq: LVLT) (10.6).

CAPS All-Star btown819 elaborates on the bull case:

Neutral Tandem has a very low valuation based on earnings and cash flows. Despite being debt free and having a very healthy balance sheet, the market has serious doubts about the sustainability of [Neutral Tandem's] business model and has priced that into the stock price. ... I think that the market has seriously misjudged this security. ... I consider [Neutral Tandem] to be a low-cost provider within their current business which should allow them to cut prices in order to retain market share. The current margins allow room for price competition in order to retain market share and grow their moat provided by the size of their network. ... This is the kind of investment opportunity I like to "back the truck up" on.

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