Amazon reportedly eating on Facebook's share of digital advertising: should you invest now?

Amazon.com Inc.’s (NASDAQ:AMZN) digital advertising push is reportedly eating on Facebook Inc.’s (NASDAQ:FB) market share after gaining traction in the competitive online advertising space. According to a New York-based digital marketing agency, Belardi Wong, 40% of the agency’s 300-plus clients reported declining Facebook ads performance while several others are branching to other platforms like Amazon. 

Both Facebook and Alphabet Inc.’s (NASDAQ:GOOG) Google digital advertising businesses face a strong challenge from Apple Inc.’s (NASDAQ:AAPL) latest iPhone update. The company launched a feature that asks iPhone users to confirm whether they wanted applications to track their online activity.

Internet tracking plays a crucial part in targeted marketing. Therefore, Apple’s update could significantly affect business digital ad performances. As such, it could be the reason why some businesses are shifting to platforms like Amazon.

So, should you invest in AMZN shares now?

Amazon shares plunged last week after a significant revenue miss and lower-than-expected top-line guidance. However, the company’s bottom line still came in better than expected and retains an exciting growth outlook for the foreseeable future.

Analysts expect Amazon earnings per share to grow by nearly 82% this year and at an average annual growth rate of about 35.77% over the next five years. Therefore, although the AMZN stock still trades at a steep P/E ratio of 58.30, its earnings growth expectations make it an exciting opportunity for growth investors.

Therefore, with the company’s digital revenue potentially rising significantly after eating on facebook’s market share, the future looks bright, making the recent plunge a perfect opportunity to buy.

Technical overview: Amazon stock price predictions for August 2021

Amazon’s recent pullback appears to have created the perfect opportunity to buy one of the most exciting blue-chip stocks in the technology sector. The AMZN stock price has now plunged closer to oversold conditions in the 14-day RSI.

Therefore, investors can target short-term rebounds at approximately $3,434 or higher at $3,525. The support levels are $3,248 and $3,152. AMZN shares traded at $3,336 at the time of writing.

Bottom line: the catalyst for investing in AMZN shares now

In summary, although AMZN shares still trade at a significantly steep P/E ratio, the recent pullback presents an attractive opportunity to buy ahead of the exciting growth story. In addition, as the company gains traction in the digital advertising space, it continues to boost its top-line growth potential, which is crucial after disappointing in fiscal Q2.