Questor share tip: Kier's yield and growth prospects offer stability after roller-coaster ride The pipeline in its property business, which builds commercial, industrial, retail and mixed-use property, stands at £1bn. All of this meant management was confident enough to increase its total dividend for the year by 3pc to 66p. The final payment of 44.5p will be paid on November 28 and the prospective yield is 4.9pc rising to 5.1pc. Part of Kier's strategy since the bottom fell out of the UK construction market has been for each of its divisions to look into adjacent markets to find growth. This means operating in new areas and new geographies, as well as focusing on higher-margin business. This includes expanding its environmental services unit and a good example was the recent purchase of a 50pc stake in Biogen, an energy-from-waste operation. Biogen owns and operates two large commercial anaerobic digestion plants in the UK and has plans for a further four. Each of the new plants, which should cost about £10m, are expected to provide a minimum return on capital of 15pc. The construction unit is holding up well although its margins are weak - and could get weaker. Over the last year margins slipped to 2.5pc from 2.7pc and some analysts think they could fall as low as 2pc this year. However, the current year should be the nadir, as international business and projects such as Crossrail kick in. Another interesting contract won last year is with housing association Circle for the maintenance of its affordable housing stock. Kier's share of the deal is worth £210m. The group outlook statement was realistically cautious. It described the trading environment as "challenging" but said the group was well-positioned. The shares have been on quite a journey this year - rising as high as £14.89 in February, before slumping as low as £10.95 after the group issued a cautious update on the state of the market. However, the shares have recovered from these lows. They were named as a tip of the year in January at £13.60 and are now 3pc above this level. Questor sees no reason why the shares should not return to their February highs. Trading on a current year earnings multiple of 10 times falling to 9.9, the downside should be supported by their attractive yield. However, real growth is not far away and they remain a buy.