Data as of 2026-09-26US market
Summary
Screened 12 undervalued US stocks on September 26, 2026; ADBE, PYPL, NKE, LEN, and CVS offer the strongest fundamental resilience, margin expansion, and valuation discounts for a 6 to 18 month horizon.
Screening weights
Fundamental improvement30%
Candidate comparison
| Rank | Ticker | Sector | 3M return | Revenue YoY | OPM Δ | FCF | Score |
|---|
| 1 | Adobe Inc. | Software | -17.5% | +10.6% | +1.5%p | Positive | 9.4 |
| 2 | PayPal Holdings | Fintech | -9.8% | +8.2% | +1.1%p | Positive | 9.1 |
| 3 | NIKE, Inc. | Consumer | -15.4% | +1.5% | +0.6%p | Positive | 8.9 |
| 4 | Lennar Corporation | Homebuilding | -14.2% | +7.9% | +0.2%p | Positive | 8.8 |
| 5 | CVS Health | Healthcare | -6.2% | +7.3% | +1.0%p | Positive | 8.6 |
| 6 | Autodesk | Design Software | -4.5% | +16.0% | +2.0%p | Positive | 8.5 |
| 7 | Western Digital | Storage Hardware | -7.2% | +23.8% | +4.3%p | Positive | 8.4 |
| 8 | Lululemon Athletica | Consumer | -20.5% | +7.3% | +0.4%p | Positive | 8.2 |
| 9 | Salesforce | Cloud CRM | -12.8% | +8.4% | +3.2%p | Positive | 8.0 |
| 10 | J.B. Hunt Transport | Industrials | -13.9% | +4.8% | +0.3%p | Positive | 7.8 |
| 11 | Starbucks | Restaurants | -4.5% | +2.2% | +0.4%p | Positive | 7.5 |
| 12 | Intel | Semiconductors | -14.5% | +7.5% | +0.6%p | Positive | 6.6 |
Screened names (observations)
Observation
Extreme cash-flow dislocation at $248-$252 multi-year low with daily RSI hovering near oversold levels. Despite conservative Q4 guidance, Q3 revenue reached a record $6.76B (+10.6% YoY) generating $2.2B+ in quarterly FCF ($8B+ annual run-rate). Trading at ~9.5x trailing FCF with an active $25B share repurchase authorization retiring 29M shares YoY.
Catalysts to watch
- Oversold technical mean-reversion toward 20-day moving average
- Commercial Firefly and GenStudio enterprise contracts scaling
- Aggressive multi-billion dollar open-market share repurchases
Risks
- Generative AI design pricing competition
- Creative agency sales cycle elongation
Framework exit signals
- Digital Media net new ARR growth falls below +8% YoY
- GAAP operating margin contracts below 32%
Metrics to watch
- Digital Media net new ARR
- Enterprise GenStudio adoption count
Observation
Trading at ~12.8x Forward P/E despite sustained operational turnaround: TMD growth +8.2% YoY, Fastlane guest checkout conversion lifting conversions by 80%, and $5B+ in buybacks retiring >7% of the float annually.
Catalysts to watch
- Fastlane enterprise scaling across Shopify and major platforms
- Venmo monetization via debit and merchant pay
- Accelerating EPS accretion from aggressive share retirement
Risks
- Competition from Stripe and Apple Pay
- Macro e-commerce consumer spending softness
Framework exit signals
- TMD dollar growth turns negative YoY
- Non-GAAP OPM falls below 16.5%
Metrics to watch
- TMD growth YoY
- Active accounts transaction volume
Observation
Historic turnaround setup at a multi-decade low valuation multiple (~18x forward P/E, 60% off peak). Former veteran Elliott Hill returning as CEO brings immediate strategic realignment back to core sport innovation, wholesale retail partnerships, and $3.8B in annual FCF providing fundamental downside cushion.
Catalysts to watch
- Executive leadership restructuring refocusing on product innovation
- Wholesale partner re-engagement across Foot Locker and specialty running
- Aggressive inventory clearance clearing path for margin expansion in 2027
Risks
- Greater China consumer spending sluggishness
- Intense competition from On and Hoka in running category
Framework exit signals
- North American wholesale order book contracts >8% YoY
- Gross margin drops below 42.0%
Metrics to watch
- Direct-to-Consumer vs Wholesale revenue mix
- Gross margin trajectory (%p)
Observation
Deep value dislocation at ~9.5x P/E with zero net homebuilding debt and $3.5B+ in cash reserves. Benefiting from post-FOMC mortgage rate easing and secular structural US housing shortages, Lennar's disciplined land-light operational execution provides high return on equity and substantial downside safety.
Catalysts to watch
- Post-FOMC mortgage rate stabilization unlocking buyer contract closings
- Consistent $250M quarterly share repurchase program
- Targeted mortgage rate buydowns sustaining high delivery volume
Risks
- Resurgent Treasury yield volatility delaying fall homebuyer traffic
- Gross margin pressure from financing incentives
Framework exit signals
- Homebuilding gross margin drops below 20.0%
- Quarterly net deliveries fall >10% YoY
Metrics to watch
- Homebuilding gross margin
- Quarterly new orders count
Observation
High-yield turnaround compounder trading at ~11.2x forward P/E with a 2.9% dividend yield. Q2 Medical Benefit Ratio improved 250 bps YoY to 87.4%, operational restructuring under management is on track, and full-year CFFO is reaffirmed at $11.5B+.
Catalysts to watch
- Multi-year Medicare Advantage margin recovery pathway
- Aetna Claims Assist AI operational cost efficiencies
- MinuteClinic and care delivery volume expansion
Risks
- Medical cost utilization spikes in late 2026
- PBM regulatory scrutiny
Framework exit signals
- MBR exceeds 89.5% for two consecutive quarters
- Operating margins compress >100 bps YoY
Metrics to watch
- Health Care Benefits MBR
- Annual operating cash flows
AlphaSignal Research: Top 5 Undervalued US Common Stocks (Sep 26, 2026)
1. Executive Summary
Following the Federal Reserve rate cut and subsequent liquidity easing across global markets, institutional capital has begun rotating toward high-quality, cash-generative leaders trading at steep valuation discounts. By screening 12 US common stocks characterized by lagging 3-month price returns despite expanding quarterly operating profitability, steady revenue growth, and robust free cash flow, we finalized the Top 5 Undervalued US Stocks offering asymmetric risk/reward over a 6 to 18 month horizon.
2. Candidate Comparison Table
- ADBE (Score: 9.4) | Software | 3M Return: -17.5% | Rev Growth: +10.6% | OPM Change: +1.5%p | FCF: Positive
- PYPL (Score: 9.1) | FinTech | 3M Return: -9.8% | Rev Growth: +8.2% | OPM Change: +1.1%p | FCF: Positive
- NKE (Score: 8.9) | Consumer | 3M Return: -15.4% | Rev Growth: +1.5% | OPM Change: +0.6%p | FCF: Positive
- LEN (Score: 8.8) | Homebuilding | 3M Return: -14.2% | Rev Growth: +7.9% | OPM Change: +0.2%p | FCF: Positive
- CVS (Score: 8.6) | Healthcare | 3M Return: -6.2% | Rev Growth: +7.3% | OPM Change: +1.0%p | FCF: Positive
- ADSK (Score: 8.5) | 7. WDC (Score: 8.4) | 8. LULU (Score: 8.2) | 9. CRM (Score: 8.0) | 10. JBHT (Score: 7.8) | 11. SBUX (Score: 7.5) | 12. INTC (Score: 6.6)
3. Top 5 Detailed Breakdown
- ADBE (9.4): Extreme cash-flow dislocation at $248-$252 (~9.5x trailing FCF); Q3 revenue hit a record $6.76B (+10.6% YoY) with $2.2B+ quarterly FCF ($8B+ annual run-rate) and active $25B buybacks retiring 29M shares YoY.
- PYPL (9.1): P/E ~12.8x, TMD +8.2% YoY turnaround, Fastlane conversion lift 80%, retiring >7% of shares annually via $5B+ repurchases.
- NKE (8.9): Multi-decade valuation low (~18x P/E, -60% off peak); returning veteran CEO Elliott Hill realigning strategy to core sport innovation, backed by $3.8B in annual FCF.
- LEN (8.8): P/E ~9.5x with zero net homebuilding debt and $3.5B+ cash reserves; easing mortgage rates and chronic US housing shortages provide strong downside floor.
- CVS (8.6): P/E ~11.2x, 2.9% dividend yield, Q2 MBR improved 250 bps YoY to 87.4%, CFFO guidance reaffirmed at $11.5B+.
4. Conclusion
- Highest Conviction: ADBE
- Best Cash-Flow Compounder: PYPL
- Best Turnaround Catalyst: NKE
- Best Balance Sheet & Value: LEN
- High-Yield Value: CVS
- Watchlist: ADSK, WDC, LULU, CRM