It was stated in the past that the Hokage is the strongest in the Hidden Leaf Village.
Yes.. The Hokage was and still is the most powerful ninja in the Hidden Leaf Village
Even assuming Tsunade was the strongest in the village, which she wasn't, let's take a look at her role as Hokage.
At that point in time, she was among the most powerful.. save for Jiraiya, none in the Hidden Leaf Village is powerful than her..
The major event that happened in Tsunade's "reign" was Pain's attack on the village.
Naturally, the Hokage, as the strongest in the village, should be able to contend with a threat like this and protect the village, right?
Well, all previous Hokage could have. But Tsunade just about did nothing. She did absolutely nothing to contend with Pain, and even her slug summon didn't do it's job, as hundreds of villagers perished until Nagato revived them. Then, naturally, she went into a coma.
NARUTO of all people had to step up to deal with the threat of Pain.
This alone should show you she isn't underrated at all; In fact, she doesn't even deserve a top 20 spot.
Tsunade is first and foremost a MEDIC.. she knows that her major role is to act as the primary healer.. Konoha has its rules in times of invasion.. it doesn't like that just because an enemy appears, the Hokage goes out and save the day.. it is everything about assessment.. Pain just defeated Jiraiya, and they are busy unlocking his secrets.. As the Hokage must decide for the greater good of the village.. heading out in the front lines and go all out against Pain without prep would cause major set back.. she did what she MUST do at that point in time.. and that is to heal and let her subordinates deal in the front lines while they assess and as she supports in the background..
In fact, if it was any other Hokage was in her shoes at that time, there would have been more damage.. None of the previous kages (save probably Hashirama) would have protected all the citizens of Konoha from Shinra Tensei.. and because of what she manage to protect even the bodies of the dead.. Yes, Nagato did revive most of those who died, but if not for Tsunade, they won't be able to be revived at all if she didn't protected their bodies (eg. Kakashi)..
Also, it but be mentioned that Katsuyu's intel about Pain's abilities gave Naruto an edge against him..
Let's move on to her other "accomplishment" which was "contending" with Madara.
People like to bring up this instance to show that she can contend with other Top 5 characters. But that argument is just ridiculous.
Tsunade had the assistance of 4 REAL Kage level allies, and still ended up being cut in half.
5 living ninjas with limited chakra and stamina vs. an undying ninja with basically unlimited chakra with 2 of the most powerful KKGs in existence? hardly a fair fight sad to say.. and honestly, without Tsunade, they wouldn't last as long as they did.. 1.) She healed Gaara and Onoki 2.) She healed Mei 3.) Involved herself in the battle, allowing them to overwhelm Madara for a moment (even Madara himself admitted this) 4.) Gave Onoki chakra to facilitate his large scale Jinton,; all doing this while tanking every possible damage.. Among the kages, she, along with Onoki were the only ones not being manhandled by Madara's mokuton clones.. Yes, she was bisected, BUT even while sustaining the greatest damage, she still managed to perform a high level time-space jutsu and summon Katsuyu and is currently risking her life just to save those who you call REAL KAGES..
The 3 Sannin being equal to each other argument is laughable. Jiraiya and Orochimaru are so far past Tsunade it's not even funny. (Gee, I guess the parrallels to Team 7 do hold true...). Sage Mode Jiraiya completely poops on Tsunade, and Orochimaru turns her into a joke as well.
This is based on what? any canon source? all you can do comparison is what Sage Mode Jiraiya (who died by physical means) and Orochimaru (who kept coming back mainly due to his intelligence and stolen jutsus).. It is true that both Jiraiya and Orochimaru have more jutsus in their arsenal, but saying they are superior to Tsunade by just those is somewhat a close minded conclusion.. Honestly, i don't think Jiraiya even in sage mode could have performed better that Tsunade during the fight against Madara..
Her Creation Rebirth is somewhat impressive... That is, until it runs out and she's left in a coma again. Outlasting her Creation Rebirth would be a cinch for any of the Top 20 prospects, so that isn't helping her here.
Creation Rebirth is the absolute pinacle of Medical Ninjutsu.. and every Jutsu has its flaws.. Tsunade using Creation Rebirth doesn't always ends up in coma.. she used it to heal herself after surviving Mabui's Heavenly Transfer Jutsu and she didn't went to coma when she used it during her fight with Orochimaru.. the reason she went into coma during Pain's attack is due to chakra exhaustion (which Kakashi apparently died from before, as well as Nagato, given the later used it to revive everyone).. During the invasion, she has already used most of her natural chakra pool to heal thousands of people simultaneously, and only went into a coma when she poured everything she got to protect everyone from Shinra Tensei (still, she managed to outrun a better shaped Anbu).. even Nagato admitted that using Shinra Tensei shortens his lifespan..
My point is that Tsunade isn't underrated; in fact, she is mostly overrated.
Yes, she is grossly underrated.. Just because she done't have flashy jutsus, people label her has weak/fodder, etc.. every narrow minded and uncivilized in my opinion..
With nothing in her arsenal except mediocre speed, Impressive (although risky) healing, and big-boom punches, she does not live up to her Hokage title nor her Sannin Title.
Mediocre speed? the only shinobi she was ever compared to with regards to speed is A, and he is the 2nd fast ninja alive.. Tsunade outran an Anbu who is in better condition and the only kage who managed to land a hit to Madara face-on.. she managed to perform her jutsu in just mere moments (countering Nagato's Shinra Tensei), and physically, the strongest character in the series, and not to mention the most natural resilient character.. that plus her array of medical jutsu which includes near-immortality, regeneration, able to heal the physic damage of Tsukoyomi and undo the effects of the Dead Demon Consuming Seal if enough for her to be considered one of the best ninjas in history and worthy of the Sannin/Kage title (Madara himself admitted that, so who are we to contest!)..
Get it together, Tsunade.
She has displayed the best at what she does and exemplifies what a true shinobi is.. she has earned my respect and no person in their right mind, unless completely blinded by certain factors can question that.. Respect for Tsunade, Konoha's Slug Princess, last scion of the Senju clan and the 5th Hokage of the Village Hidden in the Leaves!