Major technology and internet stocks have regained investor favor this year, and no company is ticking more boxes for bulls than Alphabet Inc.

Not only does the Google owner offer the strong cash flow and growth characteristics sought by investors amid rising economic uncertainty, it’s the only one of the five biggest technology firms by market value priced at a discount to the Nasdaq 100 Index.

Despite losing ground this week as easing fears about the banking system cooled high demand for megacaps, Alphabet’s shares are up 13% in March, nearly twice the gain for the tech-heavy benchmark. The rally has added more than $140 billion to Alphabet’s market value and put the stock on track for its biggest monthly gain in almost two years.

“Of the megacaps, Alphabet is the only one that has growth above 10%, that has a valuation that’s palpable, and which has the opportunity for multiple expansion,” said David Wagner, portfolio manager at Aptus Capital Advisors, who has been reducing his exposure to big tech but remains bullish on Alphabet.

The stock trades at about 17 times expected profits over the next 12 months, compared with 24 times for the Nasdaq 100 and Alphabet’s average over the past decade of 20. The valuation makes it a relative bargain among tech heavyweights. Apple Inc., Microsoft Corp., and Nvidia Corp. all trade at premiums to historical averages and the Nasdaq 100. While Inc. is cheap relative to its long-term average, its multiple of about 35 dwarfs that of the benchmark.

Alphabet shares tumbled 39% last year amid a pullback in spending on digital advertising and a broad selloff in tech stocks as the Federal Reserve aggressively raised interest rates to combat inflation. However, in recent months analysts have been raising revenue estimates for 2023 and growth is now expected to rebound to 18% from 10% in 2022.

“With Alphabet, you not only get the growth in the business, but have potential for some valuation expansion as more clarity is reached on long-term questions, like antitrust actions,” said Patrick Burton, a portfolio manager at Winslow Capital Management.

One issue that’s dogged Alphabet this year is its standing in the race to employ artificial intelligence, which has driven a frenzy of investor interest. Concerns about the competency of Bard, Alphabet’s ChatGPT rival, caused the stock to tumble in February amid fears its market share in the lucrative search advertising business was at risk.

Google recently granted access to Bard and both Bloomberg Intelligence and Bank of America Corp. analysts wrote that the launch can help ease concerns about the perceived lead of Microsoft, which uses ChatGPT technology.

“The AI story has only just started, and since Alphabet trades at a discount, it is harder to say that Microsoft or Apple have the same potential for upside,” said Winslow Capital’s Burton.

The Nasdaq 100 Index entered a bull market on Wednesday with a 1.9% advance that has the tech-heavy gauge up just over 20% from a December closing low. Big Tech has been a large contributor to the index’s advance, with major components Nvidia, Meta Platforms Inc. and Tesla Inc. the biggest percentage gainers of 2023. In a measure of how top-heavy the rally has been, an equal-weighted version of the index is up only 13% over the same period.

This article was provided by Bloomberg News.