Over the past few months FAANG stocks have been lagging broader markets. Despite grabbing a good chunk of headlines, they have not been exhibiting strength from a performance standpoint.

Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) in particular has really struggled despite running an incredibly diverse company with a huge amount of embedded option value. Google stock has clearly been the laggard of the FAANG lot, and it still has not quite recovered from an unexpected first-quarter earnings miss that sent shares plummeting at the beginning of May.

Over the past week, however, FAANG stocks have come roaring back. Over a time horizon of the past three months, GOOGL stock is down 7.6%, while the Nasdaq is up just over 3%, but as we look over the past month, GOOGL stock has managed to narrow that underperformance somewhat.

The arrows are pointing to a continued outperformance, especially with positive news in the trade war area lifting markets as a whole. As money continues to be deployed and investors reexamine just how strong Google’s value proposition is, there is ample room for GOOGL stock to continue its outperformance.

Google Stock Leadership

First a note on Alphabet stock’s leadership, as it seems to come up more and more in conversations I have about the company. More than once I have heard shareholders voice the opinion that founders Sergey Brin and Larry Page  do not care about shareholders, and that they seemed to not offer much hopeful commentary on the disappointing first quarter.

And it is true that on the surface, it appears that Tim Cook of Apple (NASDAQ:AAPL), for example, is more shareholder-friendly than Brin and Page. He commits to share buybacks and Apple sports a 1.6% dividend. He also goes on financial talk shows to espouse the virtues of the company. Brin and Page have done none of the above.

However, this is a rather myopic view.

Google’s approach is arguably more beneficial to shareholders in the long-term. Instead of burning up cash by giving it back to shareholders to prop up the stock (not that it seems to need it) like Apple has been doing for years now, Google is investing in a number of technologies and projects that have huge potential.

These are not incremental tweaks but truly transformational technologies.

GOOGL Is Betting on the Future

There simply is not another company that can rival Google in the number of products and services with the same amount of monetization potential.

An outdated Wall Street Journal article from 2015 is a common source for bears that argue YouTube is unprofitable. While there is no disclosed information on whether or not that has changed, any routine user of YouTube would be surprised to know that it isn’t very profitable in 2019.

Margins and other financial metrics are mostly guesswork, but with the major increase in advertisements and YouTube TV gaining traction, how can it not be? The network effects are mind-blowing and may just be the most valuable asset within Google aside from the core search business.

Waymo and Google Maps aren’t producing profit yet, but they are growing rapidly and undeniably loaded with potential to become a major force in non-cyclical industries. Right now the market is not giving GOOGL stock any real credit for these transformative technologies, but think about how the stock will react if just one of their many assets starts to “work.”

The Bottom Line on GOOGL Stock

Buying into this newfound momentum as investors seem to be stepping back into the big-tech FAANG names should turn out to be a profitable move. As a group, they will all probably do well, but Google is the best bang for buck.

Right now GOOGL stock trades at just 28x trailing price-to-earnings ratio. It has been cheaper than this in the past, but the current value is undeniable. This is the time and place to double down on a temporary market dislocation.

As of this writing, Luce Emerson was long GOOG stock.