VERB (3)

1. bid (a hand of cards) at less than the strength of the hand warrants;

2. bid lower than a competing bidder;

3. bid too low;

The Collaborative International Dictionary of English v.0.48:

Underbid \Un`der*bid"\, v. t.
   To bid less than, as when a contract or service is offered to
   the lowest bidder; to offer to contract, sell, or do for a
   lower price than.
   [1913 Webster]

WordNet (r) 3.0 (2006):

underbid
    v 1: bid (a hand of cards) at less than the strength of the hand
         warrants
    2: bid lower than a competing bidder [ant: outbid]
    3: bid too low [ant: overbid]