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The Smashing Pumpkins - 'Machina II'
Mostly overlooked because it never had a retail release and was distributed freely over the internet back in 2000; a time when only nerds knew how to get in on it.
Good pick. I'd argue that 'Machina' could be considered underrated as well.
Here's some of my picks, sticking with overlooked works by well-known artists (there are plenty of great, overlooked albums by obscure artists):
Our Lady Peace - Spiritual Machines
The general impression I've gotten in regards to this band is that people either think they're silly or they kind of like their mid-90's material. I think this album and 'Gravity' are really good. Streamlined, hard-hitting songs, thoughtful lyrics, great sense of melody; uplifting.
Kenna - New Sacred Cow
He may be remembered as more of a one-hit wonder by some, but this album has some classic jams. File under: synth-pop, hip-hop, clubby stuff with good lyrics.
Psychedelic Furs - Forever Now
Gruff and melodic punk/new-wave with many classic gems. I've never heard anyone talk about this album.
Q and Not U - Power
The D.C. band kept pushing the envelope on their third and final album. I think this album is often passed over in favor of their more punk albums.
The Prodigy - Fat of the Land
I'm sure this album is revered by many, but in the grand scheme of things I think a lot of people got the wrong impression from The Prodigy and are overlooking the creativity and innovation of their music.
Pinback - Pinback
They've grown more popular with their last few albums, but their first album retains a certain magic, and I've never heard it talked about much.