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Top Stock 4 – Neutral Tandem Inc. (TNDM)

Neutral Tandem Inc. (TNDM) provides third-party interconnection services to competitive carriers via tandem switches, which allow wire-line, wireless and broadband phone providers to exchange traffic between networks without direct connections.  Neutral Tandem offers services in more than 60 U.S. metropolitan markets. The company's customers include Sprint Nextel, Comcast Cable and AT&T. 

In the first quarter, Neutral Tandem's earnings rose 125% to $9 million or 27 cents per share compared with $4 million or 12 cents per share in the same quarter a year ago. During the same period, its sales rose 45.8% to $38.2 million. The analyst community expected earnings of 23 cents per share on sales of $36.4 million, so the company posted a 17.4% earnings surprise and a 4.9% sales surprise. 

Looking forward, Neutral Tandem expects its 2009 sales to range between $158 million to $165 million, up from its prior forecast of $151 million to $158 million. Wedbush Morgan recently upgraded the company from a "Hold" to a "Buy" And I couldn't agree more. 

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