Should you buy Amazon shares after launching eight streaming services in India?

By: Motiur Rahman
Motiur Rahman
Md Motiur enjoys researching how companies are solving challenges the world will face over the coming decades. In his… read more.
on Sep 24, 2021
  • Amazon has launched eight streaming services in India’s highly competitive video streaming market.
  • The AMZN stock price edged slightly lower following the announcement.
  • Amazon shares now trade at a forward P/E ratio of 50.94 ahead of an exciting EPS growth.

On Friday, Amazon.com Inc. (NASDAQ:AMZN) shares edged slightly lower despite launching eight streaming services in India. The Asian country has become the 12th nation where Amazon channels are available.

The company is using Amazon Channels to drive prime subscriptions globally. Although customers signing up for streaming still pay individually for each service, Prime offers discounted pricing and a one-stop interface to manage multiple offerings.

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The company joins key rivals Walt Disney Co (NYSE:DIS) and Netflix Inc. (NASDAQ:NFLX) in the hotly contested high growth market. 

Is Amazon a good stock to buy in Q4 2021?

From a valuation perspective, Amazon shares trade at a steep forward P/E ratio of 50.94, making the stock less attractive to value investors. However, according to analyst estimates, the company’s bottom line could grow by nearly 82% this year before rising by a further 26% next year.

Therefore, although the stock seems slightly overvalued based on its valuation multiples, growth investors could find it exciting for a long-term investment.

As a result, Amazon could still be an excellent stock to buy for investors willing to overlook its steep valuation.

Source – TradingView

Can AMZN surge above the 100-day MA?

Technically, Amazon shares seem to be facing resistance at the 100-day moving average. However, the stock is yet to reach the overbought conditions of the 14-day RSI, leaving more room for upward movement. 

Therefore, investors could target extended rebound profits at approximately $3,340 or higher at $3,704. On the other hand, if the moving average indicator remains resilient, triggering a pullback, the stock could find support at $3,302 or lower at $3,174.

Bottom line: Amazon rebound seems poised to continue?

In summary, Amazon shares continue to trade in a choppy pattern formation, swinging to a net gain of about 6.87% this year. 

The stock has recently bounced back after completing a downward swing. However, it still has room left to run before completing the recovery swing. 

Therefore, with analysts expecting AMZN earnings to grow significantly this year and next year, it might not be too late to buy the rebound.

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