Shares of D.R. Horton (DRI) - Get Darden Restaurants, Inc. Report   jumped on Tuesday after the homebuilder reported better-than-expected fiscal fourth-quarter earnings amid continued strong demand for new homes, driven in part by more stable lending rates.

The Arlington, Texas-based company posted net income of $505.3 million, or $1.35 a share, vs. $466.1 million, or $1.22 a share, in the comparable year-ago quarter. Analysts polled by FactSet had been expecting earnings of $1.25 a share.

Revenue came in at $5.04 billion, up from $4.51 billion a year ago and ahead of analysts' forecasts of $4.8 billion.

The U.S. housing market has shown signs of stability amid a pause in mortgage rates which have drifted lower following the Federal Reserve's recent decision to cut its fed funds target rate.

TheStreet Recommends

Homebuilding revenue for the fourth quarter rose 10% to $4.8 billion from $4.4 billion in the fourth quarter of 2018, while homes closed in the quarter increased 9% to 16,024 homes vs. 14,674 homes in the year-earlier quarter. 

Sales orders increased 6% to 16,805 homes and 4% in value to $4.9 billion, compared with 15,828 homes and $4.7 billion in the comparable year-earlier quarter, the company said. 

For the full fiscal year, D.R. Horton posted net income of $1.6 billion, or $4.29 a share vs. $1.5 billion, $3.81 a share, in fiscal 2018.

Homebuilding revenue for the fiscal year increased 9% to $17 billion from $15.6 billion in fiscal 2018, while homes closed in fiscal 2019 increased 10% to 56,975 homes vs. 51,857 homes in fiscal 2018.

Shares of D.R. Horton were up 4.54%, or $2.39 a share, at $55.04 in morning trading on Tuesday.