NEW YORK (TheStreet) -- Those who bought European stocks at the height of the eurozone crisis were handsomely rewarded: In 2012, the FTSE Eurofirst 300 returned 15.14%, in 2013 it increased by 12.41%. Even this year it managed a rise of around 5%.
That's despite regular warnings about the collapse of the eurozone, the Germans' reluctance to allow the European Central Bank to print money and frequent scares about the banks -- and even, in 2013, the collapse of Cyprus's entire banking system.
So those who are scared by the various political tensions -- the latest being the snap election in Greece -- and think they would be better off staying away from the old continent in 2015 should consider some factors that are likely to favor eurozone stocks in the year ahead.
The most important is the ECB's long-delayed quantitative easing effort. At the central bank's last meeting in December, President Mario Draghi made it quite clear that quantitative easing will go ahead, whether the Germans like it or not.
Exporters are likely to profit handsomely from this. Analysts at U.K. investment magazine Investors Chronicle say that a rule of thumb in Europe is that, if the euro depreciates by 10% against the U.S. dollar, this translates into a 10% upgrade for European corporate earnings.
German companies are the eurozone's biggest exporters and they have kept Europe's biggest economy going through the crisis. Recently, strategists at HSBC upgraded German stocks to overweight, saying they have been punished unnecessarily by investors scared by the crisis in the rest of the single currency area.
In fact, the strategists at HSBC prefer European stocks to U.S. equities, saying they are deeply undervalued. The trend-adjusted price/earnings ratio -- a seasonally adjusted earnings multiple used by HSBC researchers for valuation that takes into account cyclical factors -- shows that European stocks are trading at a 40% discount to U.S. stocks.