NEW YORK ( TheStreet) -- If you're worried about what higher tax rates will do to the market, you're not alone. One thing we can all agree on is that higher taxes are not bullish for the market.We may not all be ready to agree that the fiscal cliff will come (sooner or later), but when it does, many stocks will feel the pinch. It's all pretty simple really. The government can't spend more than revenue raised forever without monetizing the dollar. For savers, the frustration of watching the government artificially keep interest rates low in a hopeless attempt at mitigating previous failed policies is heart-wrenching A few companies are bucking the trend and trading near their 52 week highs. Several banks make the list, providing hope that financials may offer hope again. Finding stocks making 52 week highs is easy; finding stocks making 52 week highs likely to continue higher is the real trick. I believe these stocks have a better than average chance of continuing higher. I use a filtering process that includes:
- Minimum trading threshold; eliminating thin stocks that leave so many investors up late at night.
- Year-over-year results that are improving at a relative rate as stock price increases; we want plenty of reason why the stock should continue higher.
- Analyst price targets that are higher than the current price; we want others after us to continue the buying pressure.
- Limited insider selling; because of compensation methods and diversification goals, some insider selling is acceptable, but management should have skin in the game.
- Low short interest; I consider short sellers to be the smart money -- there is no reason to bet against them when we have plenty of stocks to pick from.
Carnival ( CCL) Carnival is one of the world's largest multiple-night cruise companies. The company offers a broad range of cruise brands serving the contemporary cruise sector of the vacation market through Carnival Cruise Lines and Costa, the premium cruise sector through Holland America Line and the luxury cruise sector through Cunard Line, Seabourn Cruise Line and Windstar Cruises. Carnival trades an average of 3.3 million shares per day with a market cap of $30 billion. 52 Week High: $39.40 Beta: 1.42 Price to Book: 1.21 Shares are now starting to break-out higher after a considerable consolidation period. With a price-to-earnings multiple above 20, I would wait for a pullback in price before moving forward. The mean price target is $40.85, leaving plenty of room to grow from here. Cruise lines are floating casinos that for the most part, don't exploit the revenue from gaming nearly as much as I believe they can. The positive is that Carnival has considerable potential to grow revenue and earnings (especially in gaming). As the cruise industry gains understanding in gaming, profits and dividends should follow. The potential leaves Carnival in a prime position for continued share appreciation.
NRF data by YCharts
NorthStar Realty Finance ( NRF) NorthStar Realty Finance operates as a real estate investment trust in the U.S., trading an average of 1.7 million shares per day with a market cap of $900 million. 52 Week High: $6.76 Beta: 1.82 Price to Book: 1.34 Shares moved higher 6.3% in the last month, but NorthStar is a relatively volatile stock. Like Carnival Cruise Lines, waiting for a retracement in price is a wise idea. Technically, over the longer term NorthStar appears very strong, but after the current strong run, holding out for an entry below $6.50 will provide greater breathing room. The current proportion sold short based on the float is 10.5%, and I find this much interest by short sellers worth looking at in more depth. The short interest isn't the only number above 10%. The dividend yield is pushing 10%, convincing short sellers to expect a reduction in dividends, and pushing the share price lower. Will the short sellers win this one? If you are willing to bet on the Fed maintaining a strong real estate market regardless of the consequences, you have to consider NorthStar Realty. NRF Revenue Per Share TTM data by YCharts
BK data by YCharts
WAG data by YCharts
Walgreen ( WAG) Walgreen, together with its subsidiaries, operates a network of drugstores in the U.S. It provides consumer goods and services, pharmacy, and health and wellness services through drugstores, as well as through mail, telephone and online. Walgreen trades an average of 6.5 million shares per day with a market cap of $35 billion. 52 Week High: $37.35 Beta: 1.22 Price to Book: 1.90
C data by YCharts
Citigroup ( C) Citigroup, the leading global financial services company, has some 200 million customer accounts and does business in more than 100 countries. Citigroup trades an average of 39.2 million shares per day with a market cap of $115 billion. 52 Week High: $38.72 Beta: 1.58 Price to Book: 0.59
BAC data by YCharts
Bank of America ( BAC) Bank of America is one of the world's leading financial services companies. Bank of America provides individuals, small businesses and commercial, corporate and institutional clients across the U.S. and around the world. Bank Of America trades an average of 150 million shares per day with a market cap of $119 billion. 52 Week High: $10.71 Beta: 1.77 Price to Book: 0.52 In the last month, the stock has really moved higher with a 11.6% increase. The run Bank of America performed in the last few months is nothing short of incredible. Well, maybe not incredible after discounting the Fed's actions, but impressive none the less. I traded BAC in the after-hour session on Monday. BAC is somewhat extended, and like several others in this article, I would sit on my hands before entering into a position for a long term hold. With that said, you want exposure in the banking space. You have the Fed watching your back, and at the point the Fed no longer is holding the floor in place, the overall economy should provide plenty of forward motion. BAC Revenue Per Share TTM data by YCharts
At the time of publication, the author had recently traded BAC but currently held no position in any of the stocks mentioned. Follow @RobertWeinstein This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.