In this article, we will discuss the 10 Most Undervalued Quality Stocks to Invest In.
On June 10, Tom Lee, Fundstrat, joined CNBC’s ‘Closing Bell’ to discuss the current state of the market, and noted that it is showing signs of jitters due to the SpaceX IPO and the consolidation of recent gains. He pointed out that significant capital will soon be raised by Google, Meta, OpenAI, and Anthropic, and he believes that the market is attempting to price these events in. Despite these pressures, Lee maintained that the situation is healthy and unlikely to derail the broader tech trade.
Regarding recent selling in chip stocks, Lee confirmed that this activity is likely related to institutional positioning due to the SpaceX IPO. He notes that SpaceX is a $75 billion IPO and, due to its inclusion in the NASDAQ 100, institutional funds are raising cash both to participate in the IPO and to establish full market-weight positions in the aftermarket, especially if the offering is oversubscribed. He identified the selling of recent winners as a source of cash, but he viewed it as a positive sign that memory stocks and semiconductors have held above their previous Friday lows, suggesting that the charts for these sectors remain intact despite the current gut punches.
Looking ahead, Lee remains bullish, expecting the tech-led uptrend to continue for the foreseeable future. He described 2026 as a year consisting of three phases, anticipating a market pullback later in the year. He explained that this projected second-phase drawdown will be driven by three factors: first, the market testing the new Fed Chair, Kevin Warsham, particularly regarding his approach to measuring inflation and potential policy misalignment with the White House; second, the supply pressure created by the lockup expirations of several large IPOs; and third, the development of oil shortages later in the year, which the market will have to address.
Our Methodology
We sifted through the Vanguard US Quality Factor ETF holdings to identify stocks that are trading below a forward P/E of 15, and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
Note: All data was sourced on June 9.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
10 Most Undervalued Quality Stocks to Invest In
10. Willis Towers Watson (NASDAQ:WTW)
Number of Hedge Fund Holders: 40
Willis Towers Watson (NASDAQ:WTW) is one of the most undervalued quality stocks to invest in. On June 8, Willis announced the expansion of its international property facility, increasing its available follow capacity to up to $60 million per placement. The enhanced facility includes a larger panel of Lloyd’s syndicates capable of providing competitive quotes across both primary and excess insurance layers.
The facility’s automatic follow capacity, supported by Willis Towers Watson’s (NASDAQ:WTW) Neuron digital trading platform, has also been expanded through the addition of new markets. It serves clients across Europe, Asia, Australia, New Zealand, South Africa, Latin America, the Caribbean, and Canada, with coverage appetite spanning sectors such as airports, hospitality, infrastructure, manufacturing, retail, technology, and transportation.
Since its launch in 2024, the facility has seen strong market adoption. The increased capacity helps clients secure competitive pricing, maintain consistent terms and conditions across placements, and obtain the coverage they need more efficiently.
Willis Towers Watson (NASDAQ:WTW) provides advisory, broking, and risk solutions. The company’s service offerings include actuarial support, broking, strategy consulting, and plan management support. It also offers administrative support for life, medical, disability, voluntary, and other benefit programs.
9. Ameriprise Financial Inc. (NYSE:AMP)
Number of Hedge Fund Holders: 50
Ameriprise Financial Inc. (NYSE:AMP) is one of the most undervalued quality stocks to invest in. On June 3, Pattern Wealth, a private wealth advisory practice managing ~$160 million in client assets, joined the branch channel of Ameriprise Financial from Thrivent Investment Management. Based in Wayzata, the team is led by Jeremy Jackson and includes financial advisor Dave Jackson and client service associate Erika Holland.
The father-son advisory team chose Ameriprise to enhance the client experience and support long-term growth through access to a broader range of tools, advanced technology, and the firm’s nationally recognized brand. The move is intended to strengthen the team’s ability to provide retirement planning, insurance, and investment advice while expanding the services available to clients.
According to Jeremy Jackson, Ameriprise Financial Inc.’s (NYSE:AMP) integrated platform, operational support, and AI-driven capabilities will help the practice deliver more comprehensive advice and personalized strategies. He noted that the transition has been smooth and that clients have responded positively to the expanded opportunities and enhanced experience available through the move.
Ameriprise Financial Inc. (NYSE:AMP) operates as a diversified financial services company. Its segments include Advice & Wealth Management, Asset Management, Retirement & Protection Solutions, and Corporate & Other.
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