We occasionally receive questions from subscribers about what they should do when stocks in our portfolio trade around our recommended limit prices. And with three of our holdings currently trading significantly above their limits, we’ve been receiving quite a few questions.

Our limit prices are arrived mainly through fundamental analysis and our estimation of a company’s true value, with the exception of our fund holdings, which are gauged more by broader industry trends. As a result, we consider any positions trading above our recommended limit as buys only on dips below our limit prices or until we either increase our limit price or recommend that you sell. The simple fact is that the markets occasionally get ahead of themselves or we were simply too conservative in our analysis, but we still want to let our winners run unless the fundamentals indicate otherwise.

Here’ out current thinking on our three positions that have most persistently traded above our recommended price targets.

• Norfolk Southern Corp (NYSE: NSC) is currently trading at just $1.50 over our limit price and, while I generally consider it one of the best-run railroads in the industry, I’m hesitant to change my limit at this juncture. There are currently two outstanding regulatory issues that could present a headwind for Norfolk Southern: The Environmental Protection Agency has proposed greenhouse gas restrictions for existing power plants (and Norfolk Southern carries a lot of coal) and the Transportation Department has proposed a rule to enhance tank car standards.

Both are known issues which don’t seem to have slowed Norfolk Southern’s run so far this year, with shares up 9.4 percent. However, despite the fact that coal revenues fell to 18 percent of total revenue last year from 23 percent in 2011, coal’s contribution to cash flow is far from trivial. That’s largely due to the railroads geography, since it serves coal states on the eastern seaboard which many of the nation’s oldest coal plants are located. In fact, I live just a short distance from the nation’s second oldest plant in Giles County, Va., which is served by Norfolk Southern. If more stringent greenhouse gas emissions are put in place, at least some of those plants will have to close and cause a further drop in utility coal demand, which already fell by 10 percent in the first quarter.

 The proposed changes to tank cars, which carry combustible liquids, don’t represent a potential direct extra cost to the railroads since tank cars are typically owned by customers. In fact, the Association of American Railroads, the industry’s trade group, actually supports tighter safety standards for cars used to transport combustibles since it reduces the industry’s liability. But retrofitting or replacing tank cars could potential dent the railroads’ business because it will take some time to bring the tank car fleet up to standards, and fewer tank cars on the rails could hurt revenue in the short term. Only about 15,000 of the 92,000 tank cars currently comply with the latest safety standards, bringing them up to code could cost as much as $3 billion.

While neither of this issues has the potential to be catastrophic for Norfolk Southern, they don’t live me inclined to boost my limit price until we know how drastic the new rules will prove to be. Norfolk Southern remains a buy only on dips below 100.

• Pall Corp (NYSE: PLL), which makes filtration and purification products, is currently trading about $4 above our $80 limit price after running as high as $91.83 in early April. When the company reported its fiscal third quarter results, earnings per share were up 9.5 percent year-over-year, while revenue grew 6.4 percent to $682.4 million.

That strong revenue and earnings growth came about though revenues from the company’s industrial segment rose by just 1 percent as compared to last year, largely due to a tough comparable period. Revenues at the life sciences segment jumped 12 percent, helping to overcome the marginal industrial gain. Revenues generated from biopharmaceutical and microelectronics systems both showed strong growth, up by 12 percent and 18 percent, respectively. Those are the company’s two largest sub-segments, so that bodes well for the rest of the year.

In fact, management bumped up EPS guidance range for the year from 9 percent to 15 percent above last year’s $3.04 to a range between $3.35 and $3.45. That’s largely due to the fact that most of the industries it serves have been showing improvement so far this year, despite lackluster growth in the overall economy.

With Pall Corp’s customer base performing well, I’m increasing its limit price to 89.

• Tiffany & Co (NYSE: TIF) has returned better than 15 percent since it was added to our portfolio in January, thanks in large part to much better than expected earnings. It reported stellar sales in its fiscal first quarter, up 13 percent to $1 billion with an 11 percent increase in same-store sales. Net earnings were up 50 percent as compared to last year.

As my colleague Richard Stavros prognosticated when he wrote about the company, expansion into the Asia-Pacific region has been a key driver for the company as total sales rose 17 percent in the period while Japan saw a 20 percent surge, largely due to consumers buying luxury items ahead of an increase in the country’s sales tax. Sales in the American region and Europe grew by 8 percent and 9 percent, respectively.

Encouraged by its strong revenue and earnings growth, in the first quarter the company spent about $7 million repurchasing its shares, and its board authorized management to spend up to $300 million on repurchases over the next three years. Management also increased its earnings outlook after its phenomenal performance, boosting its earnings outlook for the full year from between $4.05 and $4.15 to between $4.15 and $4.25 per share.

Executing well on its Asian expansion while controlling costs, we’re boosting our limit price to 111.