By nature, energy midstream infrastructure is supposed to be boring. Pipelines are boring. Crude oil storage tanks are boring. Natural gas gathering systems are boring. However, industry stalwart Kinder Morgan (KMI) has been anything but boring over the last few years.

After a few analysts questioned the firm’s cash flows, KMI stock was hit hard. Since then shares have been bouncing around with every bit of good or bad news. That’s more volatility than pipeline investors are used to.

Then Kinder Morgan did the unthinkable — it announced that it plans to cannibalize its master limited partnership (MLP) subsidiaries Kinder Morgan Partners (KMP) and El Paso Pipelines (EPB). Kinder helped popularize MLPs and used that tax structure to grow into one of the largest midstream firms in the nation.

Well, the exciting times at Kinder Morgan continue with the firm’s latest earnings release. All in all, the profits continue to roll in, as do the cash flows. Despite all the recent volatility, KMI stock remains strong.

Higher Profits At KMI

For Kinder Morgan, another quarter of positive earnings and profits goes a long way toward silencing its haters. If your remember, the biggest critique of KMI was that it was perhaps too big for its own britches and would have trouble growing its dividends/distributed cash flows (DCF) in a meaningful way. That meant the Kinder was a “house of cards” waiting to fall.

The cannibalization of KMP, EPB and Kinder Morgan Management (KMR) into KMI was designed to dismiss those concerns. And the first earnings report since announcing that landmark deal just reinforces the fact that KMI is going to be all right over the longer haul.

For the quarter, KMI reported a 15% increase in its quarterly profits to reach $329 million or 32 cents per share. That’s up from $286 million or 27 cents per share for the third quarter a year earlier. Additionally, revenues at the midstream firm increased 14% to hit $4.29 billion. Much of that increase was due to better profits at its product pipeline and terminals business.

According to CEO and founder Richard Kinder, the company moves about one-third of all the natural gas consumed in America. Fracking and continued growth in regions like the Marcellus and Utica shale have helped contribute to a 10% increase in pipeline volumes — especially in its Tennessee Gas Pipeline — which saw an 18% volumes increase — as it spans the two prolific regions. Natural gas gathering volumes grew around 6%.

That rising pipeline volume helped KMI’s two MLPs show strong profits as well. The larger KMP reported strong earnings growth as its breath of assets contributed to huge surge on the revenue and earnings front. For the quarter, KMP reported a profit of $963 million. That’s up from $689 million in the previous year earlier quarter. Meanwhile, smaller MLP El Paso Pipeline Partners reported a profit of $130 million. That was roughly flat versus a year ago.

Here’s where it gets interesting for investors and why Kinder Morgan and the new KMI are firmly in the non-boring category: Distributable cash flows and dividends are on the rise.

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The amount of cash that Kinder Morgan’s (KMI) MLPs have available to pay their investors rose considerably — 10% for KMP and 18% for EPB. That strong DCF number prompted KMP to raise its dividend by 4% to reach $1.39 per share. EPB kept its dividend in line at $2.60 per share. KMI stock added a cent increase to its dividend to hit 44 cents per share — its third consecutive quarterly increase.

And while it may not seem that important what KMP and EPB earn — considering they are going away — those rising cash flows will ultimately power KMI’s future. After it completes the $44 billion deal, KMI will use KMP’s & EPB’s cash flows to increase its dividend to $2 per share for 2015. This is roughly a 16% increase over what its project to payout for all of 2014.

Driving that payout higher into the future will be the $17.9 billion worth of new expansion projects that Kinder Morgan has identified across its business lines that will now be part of KMI.

KMI Continues To Win

The strong earnings at KMI as well as KMP and EPB highlight just how wrong some analysts were about Kinder Morgan’s future. The continued increase in volumes that lead to rising distributable cash flows will ultimately continue to make the stock a monster dividend play for those investors looking for income.

And after the markets route over the last few days, KMI is becoming an even juicier bargain.

KMI stock now trades at a forward P/E of 23 and a current yield of 4.8%. That’s not rock-bottom cheap, but it is a good bet considering that you’re actually locking in a 5.7% dividend next year when you factor a $2 per share payment. The deal looks even better when you consider that smaller rivals like Williams (WMB) are trading at much much higher forward multiples.

Ultimately, KMI’s positive profits show that Kinder Morgan is well positioned to keep growing. Hopefully, the firm’s performance will silence naysayers once and for all.

As of this writing, Aaron Levitt was long KMI.