Amazon (AMZN  ) delivered strong Q1 results that exceeded expectations for nearly every metric. However, shares finished flat which is a recurring theme of this earnings season. Further, the quarter also marked founder Jeff Bezos' last quarter as CEO, as he will remain as the company's Chairman with AWS CEO Andy Jassy will take over as CEO.

Inside the Numbers

In Q1, Amazon reported $15.79 in earnings per share which beat expectations of $9.54 per share. Additionally, revenue also topped expectations at $108.5 billion vs $104.5 billion.

The company continues to benefit from the surge in online shopping amid the pandemic as sales increased 44%. It also seems confident that this strength will persist based on its Q2 forecast of revenue between $110 billion and $116 billion which was above expectations of $109 billion. It also confirmed that this year's Prime Day will be in June as it was pushed back to October last year due to the pandemic. Usually, Prime Day is in July, but the company believes June could be better timing.

AWS reported revenue of $13.5 billion, a 32% increase from 2020's Q1. Advertising is also becoming a bigger part of the business as it is estimated to have brought in $6.9 billion, a 77% increase from last year. Its Prime program now has 200 million subscribers, a 50 million increase from the start of 2020.

International sales grew 60%, while North American sales were 40% higher. The company spent significantly last year due to higher volumes and to institute health and safety protocols. This year, costs are expected to be lower which should boost operating income.

Stock Price Outlook

Following this strong report, Amazon shares opened 3% higher but finished slightly lower. We've seen similar price action in many stocks that reported strong figures such as Apple (AAPL  ). Typically, a company beating earnings and raising guidance would certainly lead to follow-through strength in the stock. Analysts have also hiked their forecasts for full-year 2021 and 2022 figures as well which is making these stocks increasingly attractive on a valuation basis.

One interpretation of this market action is that investors may believe these stocks have peaked in terms of earnings or earnings growth, while another is that that is setting up an attractive entry point in these stocks. It's fair to say that if earnings keep trending higher, then the stock price will inevitably follow.