Buffett buys Goldman stake:
Warren Buffett’s Berkshire Hathaway Inc. (BRK-A) will buy $5 billion of perpetual preferred stock in Goldman Sachs Group Inc. (GS) that will pay a 10% dividend. Berkshire will also receive warrants to purchase $5 billion of common stock at $115 per share, exercisable in five years.
“Goldman Sachs is an exceptional institution,” said Buffett. “It has an unrivaled global franchise, a proven and deep management team and the intellectual and financial capital to continue its track record of outperformance.”
Shares of GS are trading $8.45 higher, or 6.8%, after hours at $133.50, after closing at $125.05 during the regular session. GS traded as low as $113.01 intraday before finishing up $4.27, or 3.5%. Index futures are an average of 1% higher on the news.
Senate extends alternative energy tax credits:
The U.S. Senate approved a package Tuesday afternoon that extends $18 billion in tax credits for renewable energy sources. Tax breaks for solar usage would be extended for eight years. Credits for wind energy would be extended for one year, and credits for other power sources such as ocean wave technology would be extended for two more years. The House of Representatives still has to approve the measure. The White House has endorsed the plan.
Shares of solar sector stocks, including ESLR, SOL, SOLF, LDK, and SPWR, are all bid an average of 5% higher after hours. Investors cautious to pick a single name in the space can buy a solar ETF, such as TAN. There are few pure plays in the wind energy space, but there is a global wind energy ETF called FAN. GEX is an even more diversified ETF that broadly encompasses all alternative energy sources.
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