, Inc. (AMZN), Netflix, Inc. (NFLX),, inc. (CRM) Among The 5 Most Expensive Stocks in the Market, inc. (NYSE:CRM), 89.3 forward P/E, inc. (NYSE:CRM) was a pioneer in cloud computing, with its software-as-a-service strategy fitting well with the move to online delivery of IT services. Given all the recent interest in Big Data and the cloud,, inc. (NYSE:CRM) immediately comes to mind among investors looking at companies that could innovate in new and potentially lucrative directions. Yet with much larger competitors now moving heavily into the space, Salesforce has lost much of its first-mover advantage and could find itself overwhelmed by greater competitive pressures.

Moreover, Salesforce’s growth hasn’t been all that strong lately and isn’t expected to pick up much in the coming years. Earnings growth projections of 20% this fiscal year and about 30% for fiscal 2015 seem impressive, but they hardly justify such a lofty earnings multiple. Salesforce needs to accelerate its growth if it wants to avoid disappointing its shareholders.

Range Resources Corp. (NYSE:RRC) and Cabot Oil & Gas Corporation (NYSE:COG) , 59.1 and 48.4 forward P/E
Energy companies Cabot and Range Resources are closely tied to the fortunes of the natural-gas industry, with both being big players in the Marcellus shale play, with other assets scattered around the country. Low natural-gas prices have held earnings down in the short run, but investors haven’t hesitated to look past current weak conditions to send share prices soaring on hopes that profits will rebound.

Already, natural-gas prices have climbed somewhat, helping the bottom lines of gas producers even as they scramble to boost their more lucrative oil and liquids production. But the projections for much higher earnings for both of these companies rely not only on favorable energy prices but also on substantial production growth. So far, the energy boom has delivered on that growth, but you have to be comfortable with the assumption that it will continue before buying these stocks.

When paying up pays
Expensive stocks aren’t always bad stocks. But when companies have stock prices in the stratosphere, they have little margin for error when things don’t go perfectly. If you’re thinking about buying these stocks, be sure to tread carefully and make sure you understand all the risks involved before you buy.

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Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter: @DanCaplinger. The Motley Fool recommends, Netflix, Range Resources, and and owns shares of and Netflix.

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