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I don't mean to underestimate Atalanta, but when compared to other clubs in the Champions League, there are several clubs above them in terms of strength, including Arsenal in my opinion which is slightly better than Atalanta. However, they are still a club to be reckoned with and anyone who faces them must be careful.
Last season in the Europa League was a real example when they managed to beat the strongest candidate to become champions. Almost everyone was not on their side, but in the match they were actually able to become winners, including beating a club that was unbeaten in all competitions last season.
On the other hand, the difference is that because the Champions League is different from the Europa League, here they will get more pressure, so they must be ready for that by improving their mentality.
Nobody underestimated Atalanta in the Champions League when they were the best team in Europe last season, especially as winners of the Europa League title. Atalanta is one of the best representing Serie A in the Champions League this season, but I agree that there are still stronger teams than Atalanta in the Champions League so it is very likely that Atalanta is not on the favorites list.
So far Atalanta has not started the season well, especially in Serie A. Atalanta was only able to win one of the first three matches and only got 3 points. Losing two consecutive matches has left Atalanta stuck in 12th place in the Serie A standings, so I don't think Atalanta will impress in the Champions League if they don't improve.