Excitement! Intrigue! Thrills! These are...not what you're going to find in the corner of the energy industry that deals with natural gas infrastructure. Unbelievably, insanely, and awesomely are just not words you'll usually come across in discussions of this sector.

Let's face it: Building pipelines and then piping things through them to make enough money to build more pipelines is not the stuff of action movies. But there's still money to be made by investing in this dull but critical component of our nation's fuel landscape. And making money is at least kind of exciting. 

Let's take a look at one of the sector's biggest players, Kinder Morgan (NYSE:KMI), to see if it looks like a buy.

A man in a suit with a cape flies towards a dollar sign.

Even though the sector isn't the most exciting, gas pipeline companies can still outperform. Image source: Getty Images.

An unbelievably middling dividend!

Most energy infrastructure companies appeal to value investors, and for good reason. Because they operate a fixed group of assets, they tend to pay reliable dividends to investors. Take Kinder Morgan's big competitor Enterprise Products Partners (NYSE:EPD), for example. It's raised its payout every quarter for more than 12 years. 

Kinder can't boast that kind of track record, unfortunately, after a 2016 dividend cut that slashed its payout by 75%. The company's debt levels had exploded, and it needed to divert some of its income into paying that debt down. Of course, investors fled the stock, which is still nowhere near its pre-2016 levels. However, since the cut Kinder Morgan has doubled its dividend, which now stands at $0.25 per share, for a current yield of about 4.4%. That's solid but not a standout in an industry in which big dividends are the norm. By comparison, Enterprise is yielding about 6.4% right now (although that's partly because, like many others in the sector, Enterprise is a master limited partnership, or MLP).

Kinder Morgan's dividend, though, is certainly growing fast...at least for now. Management boosted payout by 60% in 2018 and by another 25% in 2019. It plans to boost it another 25% in 2020. At the current share price of just over $20 per share, that's above 6%, which is pretty standard for the sector. The big question is, Will this dividend stick around?

Insanely reliable income streams!

Kinder Morgan makes money when companies pay it to move their petroleum products through its pipelines. Because Kinder Morgan's pipeline network is mostly focused on natural gas, you might think it would be hampered by the stubbornly low natural gas prices that have pervaded the industry of late.

But those low prices don't tend to have much of an impact on the company, thanks to the way it charges its customers. Many of Kinder's pipelines are backed by long-term contracts that specify minimum volumes, so even if a customer doesn't push any product through the pipeline, Kinder still gets paid. And because of the natural gas boom in the country -- particularly in the Permian Basin -- many of Kinder's pipelines are "fully subscribed," meaning all available pipeline capacity is spoken for. That's true for the most recent pipeline Kinder placed into service, the massive Gulf Coast Express pipeline, which came online in September. It's also true of its big Permian Highway pipeline, which is set to come online next year. 

Kinder Morgan has been handing big dividend increases out to shareholders, but its income stream seems more than capable of supporting them. In the most recent quarter, Kinder's distributable cash flow was twice what it paid out in dividends -- that's plenty of room for error. 

Awesomely lowish valuation!

So right now Kinder Morgan seems like a reasonable investment, but not an outstanding one. Its dividend is subpar but should get to par soon. Its income streams are reliable, but not extraordinary. But if it were undervalued, that might make it a better buy.

In this, as with everything else, Kinder Morgan is OK but not great. Of the ten largest pipeline companies, Kinder Morgan's ratio of enterprise value to EBITDA -- a better metric for infrastructure companies than price-to-earnings ratio, because it strips out depreciation -- is the fourth lowest at 11.9. That's a cheaper valuation than all but three MLPs (including Enterprise, in third place with a 10.7). It's lower than that of any of its peers with a standard C-Corp structure. 

That's a point in Kinder Morgan's favor, and indicates that maybe Wall Street is slightly undervaluing the stock.

An outrageously OK investment!

Kinder Morgan isn't a screaming buy. Its valuation is low but not super cheap. Its dividend is reasonable but not impressive. It's operationally sound. It reminds me of the Star Trek: The Next Generation episode in which Picard lands in an alternate universe where the best someone can say about his performance is that he's "punctual."

Still, even though there don't seem to be any big exclamation points for Kinder Morgan right now, and even though the sector, in general, isn't a thrill a minute, Kinder Morgan still looks like a reasonable buy for income investors. However, those looking for high-powered growth stocks or deep values will probably want to look elsewhere.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.