2020 is off to an auspicious start so far, with a small boom to begin January and a crash to end February. Who knows what the rest of the year will bring?

One thing is clear: There will likely be volatile markets over the next few weeks and probably months. Still, it's probably best for investors to tune out the pandemic noise and get back to what they should be doing anyway: looking for great businesses that have exciting long-term prospects and are now available at very reasonable prices. Investors may also want to add, "and which will survive the coronavirus" to their criteria.

Looking at the rest of the year, I'd argue that Google parent Alphabet (GOOG -0.17%) (GOOGL -0.22%) has a great shot of making new highs later this year -- or at least strongly outperforming the market -- for two main reasons.

A cloud icon with one arrow pointing up and another pointing down on a black background.

Google's cloud unit is key to its future. Image source: Getty Images.

Google Cloud could be a catalyst

Obviously, Alphabet's main profit center by a huge margin is its dominant search engine, from which Alphabet makes money from digital advertising. Along with YouTube ads and third-party websites, digital advertising made up 84% of Alphabet's revenue last year.

The company's valuation largely reflects this digital ads business, which grew a healthy 15.7% in 2019, at high margins. Alphabet's stock has been hit recently, as many fear a near-term economic slowdown will put a damper on 2019 ad revenue growth this year.

That may be true in the near term. However, if Alphabet can make inroads in the huge cloud infrastructure-as-a-service (IaaS) market, that could become another highly attractive core business. According to a recent report from research firm Canalys, the cloud infrastructure market is expected to grow 32% overall this year and an average of 21.5% over the next five years.

Though Alphabet was a tad late to enter the cloud infrastructure game, it's one of only a few companies with the financial resources and technology expertise to compete. That makes the IaaS market a potential oligopoly in the making, which, when combined with strong growth prospects, means a big opportunity for the three main U.S. players.

Alphabet's management has realized this and is investing heavily in its cloud. In late 2018, the company hired Thomas Kurian away from Oracle to run the unit and recently put larger investments behind five main industries: retail, healthcare, financial services, media and entertainment, and manufacturing. In a refreshing twist, Alphabet finally broke out Google Cloud revenues for the first time in its fourth-quarter earnings release, along with YouTube revenues.

The cloud results were impressive, growing a whopping 52.8% in 2019 to $8.9 billion. However, that segment not only includes infrastructure revenues from the Google Cloud Platform, but also G Suite software revenue that includes Gmail, Calendar, Drive, and Docs.

According to the aforementioned Canalys report, the firm estimates Google Cloud Platform revenue grew an even faster 87.8%, increasing its infrastructure market share from 4.2% to 5.8%. That was the highest growth rate of any of the main cloud players, albeit off a smaller base. Google has the third-largest cloud market share as of now.

With most of the top players all maintaining or gaining market share at the expense of smaller ones, Alphabet seems poised to benefit from the growth of cloud computing over the next decade. And if Kurian can make Google an even stronger player than a distant No. 3, shareholders have quite a lot to look forward to.

A new focus on shareholder value

The other reason Alphabet's shareholders stand poised to benefit in 2020 is that management seems to have gotten serious about spending and capital returns to shareholders. CEO Sundar Pichai recently took over as full-time CEO, with founders Larry Page and Sergey Brin stepping back from day-to-day operations. He and CFO Ruth Porat, who joined Alphabet from Morgan Stanley in 2015 to instill more financial discipline, have indicated they are going to be more shareholder friendly going forward.

What does that mean? First, the company has finally loosened the purse strings with respect to stock buybacks. For years, Google's extremely cash-generative business model piled up a war chest on its balance sheet. However, Alphabet had not really returned much of that cash to shareholders, with the company's cash holdings reaching a whopping $120 billion as of last quarter.

Alphabet more than doubled its pace of buybacks last year, returning $18.4 billion to shareholders in 2019. Yet on the conference call with analysts, CFO Ruth Porat said that the company was going to continue to repurchase shares at "at least" the pace of the fourth quarter, in which share repurchases were $6.1 billion.

That likely means Alphabet could return as much as $25 billion or even more to shareholders this year. With the recent sell-off in shares due to coronavirus fears, every dollar of buyback will be able to retire even more shares of the company. At the current market capitalization, $25 billion in buybacks could retire a not-insignificant 2.8% of shares outstanding.

In addition, it appears that Alphabet may be reigning in spending on its money-losing "other bets" business, which generated an operating loss of $4.8 billion last year.

The company recently raised $2.25 billion for self-driving car unit Waymo from outside investors. That was Waymo's first outside funding round, though Alphabet had raised about $1 billion for its Verily life sciences unit last year. According to the Financial Times, Waymo raised the money at a $30 billion valuation, so Alphabet shareholders were diluted only by about 7.5%. Raising more outside money at great valuations means more cash leftover for shareholders, and I'd expect more disciplined spending at Alphabet in this new regime.

A fairly coronavirus-resistant stock

Though Alphabet would be affected by any headwinds in the advertising industry as a result of a coronavirus-fueled recession, if people are stuck home for long periods, they're likely to be watching YouTube and Googling things. That makes Alphabet a candidate to survive any coronavirus-related downturn rather well.

With a larger share repurchase appetite and cloud infrastructure kicking into gear, Alphabet offers one of the best risk-reward ratios in the market today. Alphabet has long been a top stock to own, and I think 2020 is shaping up to be even better than normal -- at least relative to the sickly overall market.