European stocks have risen half as much as global benchmarks this year, leaving them cheaper than equities in the U.S. and Asia as the region's economy starts to recover from the longest recession on record.

After a 7.2 percent gain in 2013, the Euro Stoxx 50 Index trades at 12.5 times projected earnings, 6.7 percent less than in 2009, the last time the euro area was in the final quarter of a contraction, data compiled by Bloomberg show. In the U.S., where the economy is in its 10th straight quarter of growth, the Standard & Poor's 500 Index is valued at 15.3 times estimated profit and Japan's Topix trades at 14.2 times income after Prime Minister Shinzo Abe vowed to end two decades of deflation.

Investors from JPMorgan Chase & Co. to Barclays Plc say European stocks are cheap as the first expansion for euro-area manufacturing in two years helps drive forecasts for profit growth of more than 10 percent in 2013 and 2014. Bears point to concern that next month's German election may lead to a push for tougher austerity measures in Europe's weakest economies.