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.
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.