By Roger Conrad, The Utility Forecaster

AT&T (T) has a core strategy that is oriented around upwards of $5 billion in capital spending every quarter to expand the capability of its wireless and broadband network.

That’s made possible thanks to $10 billion-plus in quarterly cash flow. And although it failed to buy Deutsche Telekom ’s T-Mobile USA unit last year, the company did continue to execute its formula for robust long-run growth.

The chief challenge is accommodating wireless network traffic that grew an estimated 40 percent last year. Priority one is expanding AT&T’s 4G network based on long-term evolution (LTE) technology.

Management bought $1.9 billion worth of wireless spectrum from Qualcomm in late December. And it’s rumored to be pursing a takeover of far more spectrum-rich Dish Network.

Congress is currently considering a proposal to auction unused wireless spectrum allotted to the TV industry. The FCC could place conditions on AT&T’s ability to bid.

That won’t alter the fact, however, that only AT&T and Verizon have the money to put acquired spectrum to work immediately.

AT&T’s boost in data rates last month -- even as it added business -- clearly demonstrates it’s vibrant as ever in the constantly expanding connectivity marketplace.

On track for consistent annual earnings growth of at least 6 to 7 percent and paying a rising dividend of nearly 6 percent, AT&T is a solid, low-risk buy up to $33.

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