Companies with high valuations share an attribute: Investors expect them to beat analysts' expectations.

The following 10 stocks are, by definition, expensive. (One of them trades at a price-to-projected-earnings ratio of 672.) If they exceed earnings estimates, the shares will retain momentum. If they miss, look out below.

Earnings season starts in two weeks, during which time the stocks listed below may become volatile. In the second quarter, the S&P 500 Index fell 12%, declining to an eight-month low on concern about slowing global economies, particularly weak job growth and consumer spending in the US.

Doug Kass goes further. He says stock-market gains are being hobbled by "rising taxes; fiscal imbalances in federal, state and local governments; the absence of drivers to replace the prior cycle's strength in residential and nonresidential construction; the long tail of the last credit cycle (Greece, Portugal, Spain, et al.); and inept and partisan politics."

Here are the 10 most expensive stocks, according to price-to-projected-earnings ratios.

10. Amazon

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[AMZN  Loading...      ()   ] is the world's largest online retailer, selling music, books and electronics. It was flooded with business during the recession as consumers sought bargains on the Web.

Since 2007, Amazon has increased revenue 33% annually, on average. Its stock sells for a price-to-projected-earnings ratio of 28. Its PEG ratio, a measure of value relative to predicted long-run growth, of 1.1 indicates that the stock is overpriced by roughly 10%. 

9. Red Hat

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[RHT  Loading...      ()   ] designs open-source software. Since 2007, it has increased net income 14% a year, on average. Its stock returned 10% a year over the same span. It currently trades at a price-to-projected-earnings ratio of 34, a 67% premium to the software industry average. Its PEG ratio of 1 indicates that the stock sells at fair value, based on long-term growth expectations. But the stock is costly based on book value, sales and cash flow per share.