In this episode of the Left Brain Thinking podcast, host Chuck Jaffe interviews Mark Hines, Managing Director at Left Brain Investment Research, about the firm’s monthly "Chosen List" and a highlighted stock, Qualcomm. Hines explains that the Chosen List is a curated set of top stock and bond ideas generated each month through a multi‑step process: quantitative, fundamental, and technical screens feed into the proprietary Jarvis software, which produces rankings; the firm’s CIO, Nolan Langford, then hand‑picks the final names. The February list contains more stocks than usual due to a higher number of individually attractive opportunities, not macro conditions. Qualcomm is featured because of its dual business model—chip manufacturing and a pervasive patent/licensing operation—giving it a massive total addressable market (estimated $100 billion by 2022) and a favorable entry point after a recent earnings‑driven price dip. Hines emphasizes the 5G, IoT, and broader digital transformation trends that underpin Qualcomm’s growth runway. Regarding portfolio construction, Left Brain prefers concentrated portfolios of roughly 25‑30 stocks, allowing winners to run while monitoring a 10% position size as a potential signal to trim. Stocks are removed only when a superior idea emerges, reflecting a dynamic, stock‑specific focus rather than macro‑driven timing. The conversation concludes with standard disclosures and information on how listeners can learn more about Left Brain’s services.
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Welcome to Left Brain Thinking, where creative investment ideas meet logical analysis. That's the hallmark of Left Brain Investment Research, where the analysts are looking for growth companies with the potential to double in 2 to 3 years and high-yield bonds with the potential for dramatic price appreciation. Today we're talking with Mark Hines, Managing Director at Left Brain Investment Research, about the firm's chosen list, the latest version of which was released at the start of February. Mark Hines, great to have you back on Left Brain Thinking.
Hey Chuck, I'm happy to be here.
So The Chosen List, this is something that you guys do each month, but it takes a little something special to make The Chosen List. So let's talk first about what goes into it and why The Chosen are actually chosen.
Sure, excellent. So The Chosen List is basically a monthly top ideas list that we put together. And there's actually one for stocks and one for bonds each month. This February's edition, it's heavy on the stocks, larger number than usual made it on the list. Typically, there's 3 or 4 stocks that will make it on the chosen list. But you're exactly right. There's a lot of things that go into it. We've got a detailed process. It's based on quantitative, fundamental, and technical indicators. We use our proprietary software application called Jarvis. It spits out some rankings for us. And then after all of that, our CIO, Nolan Langford, will go through and he will hand-select each month some of the top ideas to make it into the chosen list. It's a list we're real excited about and we just put it out a few days ago.
If it's got more stocks than usual, is that because there are more great opportunities or because the underlying market looks particularly good now? What would create a larger than normal chosen list?
Well, we've got a good batch this month. It's not based on overall macroeconomic conditions. It's just based on the individual names that come up really, really attractive on our list this month. As you know, we don't focus on macroeconomics. We're very stock-specific. We go where the best individual stock-specific ideas are, and it's the same thought behind behind the chosen list.
So let's talk about a name that is on this month's chosen list. What's a stock that particularly stands out to you right now, and what has it there on that list?
This month, one of the names that made it onto the chosen is Qualcomm. Qualcomm basically makes chips that go into smartphones, but the other half of their business model is this patent business they've got going on. They call it sort of their no license, no chips business model. Qualcomm, basically, chips are in— either the chips or the patents are in pretty much every smartphone out there right now. So the opportunity is big, a large total addressable market. It's growing. They just put out a new estimate. The total addressable market is around $100 billion by 2022, significantly larger than their current revenue stream is. And then also, the shares have been a little bit weak, actually, after the last earnings announcement. I know you tend to be more of a value guy, So there is a decent entry point or a little bit of margin of safety to get into Qualcomm right now. So it's just, it's really attractive opportunity at the moment.
I'm familiar with this stock because although I may have a value bent at times, well, I certainly wasn't looking at it as a value stock when I purchased it, which I did a few years ago. And that to me is part of what interests me because, oh, by the way, I bought it a couple of years ago and this could have been a left-brain stock back then.
Why?
Well, what we say, you're looking for stocks that'll have the potential to double in a couple of years. Well, this stock is more than doubled for me in a couple of years. So in spite of that kind of growth, in spite of the fact that this has already achieved what left brain likes and looks for, this is still a good entry point.
Absolutely. I mean, the 5G trend that we've talked about in the past, the Internet of Things, Everything now is using chips, whether it's smartphones or smart cities or smart vehicles. Everybody's got these chips in them now. And the opportunity's really, really big. You know, we, as we move sort of past the beginning of the pandemic and everybody moved to this sort of online digital revolution, it's continuing, right? There's so much opportunity to move to digitize the world. And Qualcomm is just gonna be a huge winner in this space. They've got a long runway. We talked a little bit about that total addressable market being very, very large. And, you know, they've just got this huge competitive advantage versus everybody else because of this kind of no license, no chip policy. And they, they really are in just about every smartphone out there, whether it's their parts or their patents. So it really is a good opportunity with a long runway to go.
In terms of building a portfolio, I mean, obviously 5G, it's a theme. There's a lot of great issues that you've talked about, not only chosen with stuff, but stocks that we've talked about on Left Brain Thinking before. When you're creating a position and you're thinking about a broader portfolio, how much do you let a stock like Qualcomm be? Do you wind up saying, hey, I want to have a concentrated portfolio? Do you worry if you're going, I like a couple of 5G things, that I'm a little too overfocused in one industry? When you're looking at an individual name, how do you decide the role it plays in a broader portfolio?
That's a great question. We do like concentrated portfolios. We also like to let our winners run. Typically, if something gets over 10%, that's usually a good indicator that it might be time to pull back a little bit. But, you know, a 30-stock portfolio, 25, 30 stocks, is kind of right up our alley. So yeah, concentration is really, really important to us. Take, for example, Netflix or something like that, or, or Amazon. I think Freddie Garcia was talking to you about Amazon last week, right? And people said sell it at $1,000, it'll never— or when it gets to $1,000, and you know, it'll never get to 2,000 and then never get to 3,000. So you got to let your winners run. And kind of the way we measure that again is this total addressable market size, right? Qualcomm is a leader in this industry and the market opportunity is very, very large. So there's still a lot of runway for this stock to keep growing.
Yeah, and as I said, it has been running. When you consider the Chosen List, right, I know that you guys are not putting target dates on things, etc., but we talk about a stock that you want to see certain growth characteristics over the next couple of years? Do you go in thinking, hey, and if I don't see this or that, it would be a sell? So I mean, what would get Qualcomm kicked off the chosen list and/or kicked out of your portfolio?
Sure, when a better idea comes along, we'll kick it out, right? So we, you know, we follow probably over 1,000 stocks through our, through our quantitative process, and then the team here kind of digs in and does more fundamental research on each of them. And really what causes something to get kicked out of a portfolio is just when a better opportunity opportunity comes along. There are a lot of individual stock-specific opportunities out there, so we'll hang on to a name like Qualcomm until something better comes along. You know, if it's a, say, 30-stock portfolio and the new greatest thing comes along, you know, stock number 30 will get kicked off the list.
But right now, Qualcomm, well, it is one of the chosen ones. Mark Hines, thanks so much for joining me to talk about both Qualcomm and the chosen list.
Thanks so much, Chuck. It's my pleasure.
Left Brain Thinking is a joint production of Left Brain Investment Research and Money Life with Chuck Jaffe. Our conversations are not personalized investment recommendations but are designed to engage your brain. Please do your diligence before making any financial transaction. I'm your host, Chuck Jaffe, and you can learn more about my weekday podcast at moneylifeshow.com. Thanks to my guest, Mark Hines, Managing Director at Left Brain Investment Research. Learn more about the firm and its services, about the chosen list, and even about Qualcomm, Q-C-O-M, at leftbrainir.com. On Twitter, @leftbrainir. Left Brain Thinking is available every Wednesday. Find it and subscribe on your favorite podcast app and plan to put your left brain thinking cap on every week. Until next week, stay safe, everybody.
