3 Undervalued U.S. Stocks Wall Street Likes in September 2026
Three U.S. stocks stand out in September 2026 as Wall Street sees further upside: Booking Holdings, Cloudflare and Okta.
9/9/202611 min read
3 U.S. Stocks Wall Street Thinks Could Still Be Undervalued in September 2026
Finding a genuinely attractive stock in 2026 is becoming increasingly difficult.
The U.S. market is not exactly cheap, artificial intelligence has pushed valuations higher across large parts of the technology sector, and investors are paying enormous premiums for companies perceived to be positioned on the right side of the AI revolution.
But expensive markets do not mean there are no opportunities.
They simply mean investors have to look beyond the obvious winners.
Three companies stand out in September 2026 for very different reasons: Booking Holdings, Cloudflare and Okta.
They operate in different industries, have very different risk profiles and are at completely different stages of maturity. But they share one important characteristic: Wall Street analysts still see meaningful upside from current prices.
That does not mean these stocks are guaranteed to rise. Analyst price targets are estimates, not promises, and each company has meaningful risks. But the combination of valuation, business quality, structural growth and exposure to some of the biggest trends shaping the economy makes these three companies worth studying.
1. Booking Holdings: The Travel Giant That Survived the Dot-Com Crash
The first company is Booking Holdings (NASDAQ: BKNG), the parent company behind Booking.com, Priceline, Agoda, KAYAK, Rentalcars.com and OpenTable.
At first glance, Booking might seem like an unusual candidate for a technology stock list.
It isn't.
Booking is one of the largest digital travel platforms in the world, connecting travelers with hotels, airlines, rental cars, restaurants and other travel services. Its business has become deeply embedded in the global travel ecosystem and there is something particularly interesting about its history.
The company survived one of the worst technology bubbles in modern financial history.
Priceline went public in 1999, at the height of the dot-com boom. Its original business model was based on the famous "Name Your Own Price" concept, where customers submitted the price they were willing to pay and suppliers could accept or reject the offer.
The market initially loved the story.
Then the bubble exploded.
Priceline's valuation collapsed, and the company had to fundamentally rethink its business. One of the most important decisions in that process was acquiring Booking.com, which eventually became the dominant brand inside what is now Booking Holdings. Priceline acquired Booking.com in 2005, after earlier acquiring Active Hotels.
That decision turned out to be transformative.
Today, Booking Holdings is a completely different company from the Priceline of the late 1990s.
In 2025, Booking generated approximately $26.9 billion in revenue, up 13.4% from 2024. Gross bookings reached $186.1 billion, while free cash flow reached approximately $9.1 billion.
The important part is not simply that revenue is growing.
It is how Booking makes its money.
The Shift From Agency to Merchant
Booking has two major revenue models.
The first is the merchant model.
In this structure, Booking facilitates the payment itself. A traveler makes a reservation and pays through Booking, after which the company transfers the appropriate amount to the hotel or other travel provider.
This gives Booking substantially more control over the transaction.
It can offer payment products, combine hotels with flights or rental cars, sell insurance and create broader travel packages.
The second model is the traditional agency model.
The traveler books through Booking, but payment is made directly to the hotel. Booking then receives a commission for generating the customer.
The company has been gradually shifting toward the merchant model.
That transition is important because merchant gross bookings increased 24.8% in 2025 to approximately $130 billion, while agency gross bookings declined 8.7% to $56.1 billion. Booking itself says the shift from agency to merchant transactions remains an important part of its strategy.
In other words, Booking is not simply selling more hotel rooms.
It is trying to capture more of the economic value generated by each transaction.
That is a subtle but important distinction for investors.
The AI Threat to Booking Is Real
There is, however, a major threat hanging over the company.
Artificial intelligence could fundamentally change how people search for travel.
Today, someone might open Google, search for "best hotels in Paris," compare dozens of websites and eventually visit Booking.com.
But imagine a future where the user simply tells an AI agent:
"Find me a five-star hotel in Paris for four nights, under $2,000, close to the Louvre, with a gym and free cancellation."
The AI could perform the search, compare prices, read reviews, check availability and potentially complete the reservation without the user ever visiting Booking.com.
That creates a strategic problem.
Booking has spent decades building one of the world's strongest travel marketplaces. But AI could potentially become the new interface between consumers and those marketplaces.
The company clearly understands the threat.
Booking says AI is intended to be central to its long-term "Connected Trip" strategy, and it is already developing AI-powered travel experiences and agentic products across its portfolio.
The investment question is therefore not simply whether AI will hurt Booking.
It is whether Booking can become one of the companies powering the AI-mediated travel ecosystem rather than becoming invisible behind it.
That distinction could determine whether Booking remains a dominant platform over the next decade.
What Wall Street Sees
As of early September, Booking Holdings was trading around $193 per share, while the average analyst target was approximately $238.68, implying roughly 23% upside. The consensus rating was Buy, with 39 analysts tracked by S&P Global.
That does not make Booking a cheap stock in absolute terms.
It makes it a potentially attractive stock relative to what investors are paying for its earnings and cash generation.
And that is a much more useful way to think about valuation.
The real question is whether the market is underestimating how effectively Booking can continue converting travel growth, payments and AI into higher earnings and cash flow.
2. Cloudflare: The Infrastructure Behind the AI Internet
The second company is considerably more aggressive.
Cloudflare (NYSE: NET) sits at the intersection of cybersecurity, cloud infrastructure, networking and artificial intelligence.
The easiest way to understand Cloudflare is to imagine the internet as a massive highway system.
Cloudflare sits across large portions of that infrastructure, helping traffic move faster while filtering malicious activity.
Its services include content delivery, cybersecurity, application protection, zero-trust networking, developer tools, computing, storage and increasingly AI-related infrastructure.
That makes Cloudflare particularly interesting in the current environment.
Because AI does not reduce the importance of internet infrastructure.
It increases it.
AI Is Creating a New Internet
The internet was originally designed primarily around humans interacting with websites.
AI agents are beginning to change that.
Instead of millions of people individually browsing websites, software agents can increasingly interact with websites, APIs and digital services on behalf of users.
That could create enormous amounts of machine-to-machine traffic.
And machine-to-machine traffic introduces new problems.
Who is the agent?
Is it authorized?
What information can it access?
How frequently can it make requests?
Can it be trusted?
Can the traffic be malicious?
Cloudflare believes this represents a fundamental transformation of the internet.
Its management has described the shift toward AI answer engines and agent-driven commerce as a major structural opportunity for the company.
This is one reason Cloudflare is particularly interesting.
It does not need to build the most successful AI model.
It can potentially make money from the infrastructure required for thousands of AI applications and agents to operate.
The Growth Numbers Are Difficult to Ignore
Cloudflare generated $696.1 million in revenue during the second quarter of 2026, an increase of 36% year over year.
For the first half of 2026, revenue reached approximately $1.34 billion.
The company also generated positive free cash flow, although GAAP profitability remains negative. In Q2, Cloudflare produced $56.4 million of free cash flow while reporting a GAAP operating loss of $205.7 million.
This distinction matters.
Cloudflare is not yet a conventional mature software company producing large GAAP profits.
It is still investing aggressively.
But it is already producing cash.
That gives the company significantly more flexibility than a high-growth company dependent entirely on external financing.
Cloudflare also had approximately $4.16 billion in cash, cash equivalents and available-for-sale securities at the end of June 2026.
Its customer base is another important advantage.
The company reported more than 4,600 large customers in the second quarter, while more than 45% of the Fortune 500 were paying customers as of June 30.
That creates something increasingly valuable in enterprise software:
distribution.
Once a large organization integrates Cloudflare deeply into its infrastructure, replacing it is not necessarily trivial.
But Cloudflare Is Not a Low-Risk Stock
There is a reason investors should be careful.
Cloudflare's valuation already reflects enormous expectations.
At the beginning of September, the stock was trading around $279. The average analyst target was around $355, implying approximately 27% potential upside, with a consensus rating around Buy or Moderate Buy depending on the analyst aggregation used.
That sounds attractive.
But Cloudflare's valuation is far more demanding than Booking's.
If growth slows significantly, the stock could fall even if the company continues to perform well operationally.
This is one of the most important lessons in growth investing:
A great company can still be a bad investment if you pay too much for it.
Cloudflare therefore represents a different kind of opportunity from Booking.
Booking is primarily a mature cash-generating business where investors are asking whether the market is underestimating future earnings.
Cloudflare is a high-growth infrastructure company where investors are asking whether today's enormous expectations will eventually prove conservative.
The upside can be much larger.
So can the downside.
3. Okta: The Company That Could Become More Important as AI Agents Multiply
The third company is Okta (NASDAQ: OKTA).
And it might be the most interesting of the three from an AI-security perspective.
Okta specializes in digital identity.
In simple terms, it helps companies answer one fundamental question:
Who is allowed to access what?
That sounds simple.
At large corporations, it is anything but simple.
A company may have tens of thousands of employees, contractors, customers and applications. Each person may have access to different systems and different levels of information.
Okta provides the infrastructure required to authenticate users and control those permissions.
But artificial intelligence introduces a new problem.
The next generation of software users may not all be humans.
They may be AI agents.
AI Agents Need Identities Too
Imagine an AI agent working inside a company.
It might have permission to read financial reports, access a customer database, create a presentation and send emails.
But should it have permission to transfer money?
Should it access employee salaries?
Should it modify production systems?
Should it be able to download an entire customer database?
Those are identity and authorization questions.
And this is where Okta sees an enormous opportunity.
As AI agents become more autonomous, companies will need to determine not only which humans can access their systems, but which machines can access them, what those machines are allowed to do and under what circumstances.
Okta's management has explicitly identified securing AI agents as an emerging requirement for its identity platform.
That could create an entirely new layer of demand for identity infrastructure.
The Financial Profile Is Improving
Unlike Cloudflare, Okta has already crossed an important threshold.
It is profitable.
For fiscal 2026, Okta generated approximately $2.92 billion in revenue, an increase of 12% year over year. GAAP operating income reached $149 million, compared with a $74 million operating loss in the previous fiscal year.
The company generated approximately $863 million in free cash flow during the year, representing a 30% free-cash-flow margin.
It also ended the fiscal year with approximately $2.55 billion in cash, cash equivalents and short-term investments.
That is a much stronger financial position than the company had several years ago.
And the balance sheet provides something investors often underestimate:
time.
Okta can continue investing in new products, compete against larger companies and develop its AI-security offering without being forced to raise capital simply to survive.
The Biggest Risk: Microsoft
There is, however, an obvious problem.
Identity management is not an empty market.
Microsoft already operates Entra, its identity and access-management platform, and has enormous distribution among enterprise customers.
This means Okta is fighting against one of the most powerful software companies in the world.
That does not make Okta's business model invalid.
But it means investors must believe Okta can maintain enough technological differentiation and customer loyalty to justify remaining an independent identity platform.
This is probably the biggest risk in the investment thesis.
The AI opportunity is enormous.
The competitive environment is also becoming increasingly intense.
What Wall Street Expects
Okta was trading around $170 in early September 2026.
The average analyst target was approximately $182.37, implying about 7% upside over the next year. The consensus rating remained Buy, although the range of analyst estimates was wide, from $127 to $203.
At first glance, that upside looks much less exciting than Booking or Cloudflare.
But there is another way to look at it.
Okta may have the most conservative expectations of the three.
If AI agents become a major part of enterprise computing, identity and authorization could become substantially more important than the market currently assumes.
In that scenario, today's analyst targets could eventually prove far too conservative.
The Common Thread: AI Is Changing More Than Just AI Companies
These three stocks illustrate something important about investing in the artificial intelligence revolution.
You do not necessarily have to own the company building the most powerful AI model.
You can invest in the infrastructure surrounding the transformation.
Booking represents the consumer and transaction layer.
Cloudflare represents the network and infrastructure layer.
Okta represents the identity and security layer.
All three could benefit from AI, but in completely different ways.
That is strategically important.
Investors sometimes make the mistake of treating AI as a single industry.
It isn't.
AI is becoming a general-purpose technology, meaning its economic effects can spread through virtually every sector.
The companies that benefit may therefore include semiconductor manufacturers, energy providers, cloud infrastructure companies, cybersecurity firms, software platforms, payment networks, data-center operators and companies that own valuable distribution channels.
The real investment opportunity may be found one or two steps away from the obvious AI winners.
Which One Is the Most Interesting?
If I had to separate the three by risk profile, the distinction would be relatively clear.
Booking Holdings is the most mature business.
It has enormous cash generation, a powerful global brand portfolio and exposure to the long-term growth of international travel. Its biggest challenge is maintaining direct access to consumers as AI becomes a new interface for travel discovery.
Cloudflare offers the highest-growth story.
Revenue is expanding rapidly, free cash flow is positive and AI could increase demand for the infrastructure and security required by an increasingly machine-driven internet. But valuation risk is substantial.
Okta sits somewhere between the two.
Its growth is slower, but profitability and free cash flow are already established. The potentially transformative variable is whether AI agents create a new category of identity and authorization demand.
In other words:
Booking is the cash-flow story.
Cloudflare is the growth story.
Okta is the AI-security optionality story.
And that is precisely why putting all three into the same portfolio would not necessarily mean making the same investment three times.
They are exposed to different parts of the technological transformation.
The Bigger Investment Lesson
The most interesting stocks are not always the ones everybody is talking about.
By the time an investment theme becomes obvious to everyone, much of the expected future growth may already be reflected in the price.
That is why the better question is not:
"Which company is benefiting from AI?"
Almost everyone knows the answer to that.
The better question is:
"Which businesses could benefit from AI in ways the market has not fully priced in?"
That is a much harder question.
Booking could benefit if AI increases the value of its transaction infrastructure rather than eliminating the need for travel platforms.
Cloudflare could benefit if AI agents create an entirely new layer of machine-to-machine internet traffic.
Okta could benefit if autonomous software agents make identity and authorization one of the most important problems in enterprise technology.
None of these outcomes is guaranteed.
But that is exactly what makes them interesting.
The market does not pay investors for certainty.
It pays investors for correctly assessing probabilities before everyone else does.
And in September 2026, these three companies offer three very different ways to participate in the next stage of the technology cycle.
For investors willing to look beyond the biggest AI names, that may be where some of the more interesting opportunities are beginning to emerge.
Investment Snapshot
CompanyTickerCore OpportunityMain RiskApprox. Analyst UpsideBooking HoldingsBKNGTravel, payments, AI-powered commerceAI disintermediation~23%CloudflareNETInternet infrastructure, cybersecurity, AI agentsHigh valuation~27%OktaOKTAIdentity, enterprise security, AI agentsMicrosoft competition~7%
Analyst targets are estimates, not guarantees. Market prices and consensus targets can change rapidly.