The world is holding its breath in anticipation of a thrilling US election, threatening market volatility. UK stocks have not escaped the effects, with some suffering notable declines in recent weeks.

Last weekend, I took stock of FTSE100 stocks in my portfolio. I found three that I believe are trading significantly below their fair value.

Here, I’ll highlight why these valuations look attractive to me. If I wasn’t already invested, I would consider buying these big names in November.

Taylor Wimpey

Taylor Wimpey (LSE:TW) is one of the most affordable housebuilding stocks in the FTSE 100. Now at £1.47, the share price has fallen 13% since this year’s high of £1.68.

Despite the property market’s sensitivity to inflation, it benefits from strong demand for affordable housing in the UK. Thanks to supportive government policies (such as the Help to Buy scheme) and an ongoing housing shortage, housebuilders remain well placed to meet long-term demand.

It also has a strong dividend history, which is attractive to income-oriented investors.

The main disadvantage is exposure to interest rates, which impact the affordability of mortgages and, therefore, the demand for new housing. Rising material and labor costs could also weigh on profitability.

It is currently trading 32.8% below its fair value using a discounted cash flow (DCF), with a price/earnings ratio (P/E) of 21.2.

Lloyds Banking Group

Lloyds (LSE: LLOY) fell last week after an unexpected development in the ongoing controversy over the misselling of Payment Protection Insurance (PPI). The price has already started to rise but remains close to its lowest level in almost six months.

Despite economic challenges, its extensive branch network and well-established brand give it a competitive advantage. As one of our largest retail banks, it has a strong foothold in the domestic market. Additionally, even though interest rates remain high, the country continues to enjoy better profit margins on loans.

However, its exposure to the UK economy means Lloyds is susceptible to economic downturns, including a potential increase in bad debts if customers struggle to repay their loans.

It has a low P/E ratio of 7.5 and is undervalued by 55.3% based on a DCF model. It also pays a constant dividend with a rate of 5.3%. yieldwhich may appeal to income-oriented investors.

Reckitt Benckiser

Reckitt Benckiser (LSE: RKT) is often considered a reasonably priced defensive stock, especially for those interested in consumer staples and healthcare. It’s not priced ‘cheap’ like Lloyds or Taylor Wimpey, but it could generate attractive returns in the coming months.

Like many companies, Reckitt has been hit by inflation and supply chain issues, particularly in terms of raw materials and transportation. These rising costs could put pressure on profit margins if the company cannot pass the costs on to consumers.

This year, she faced a high-profile legal battle in the United States over her Enfamil infant formula, which led to a considerable drop in price. However, last week a Missouri state court jury cleared the company of any liability.

The price is recovering and is expected to continue, with profits expected to grow 11.3% annually in the future. Return on equity (ROE) is expected to reach 28% over the next three years.