NEW YORK (TheStreet) -- Last year at this time, I published a column focused on the proliferation of initial public offerings of companies offering "free" services. These names generate revenue via advertising, while some also offered premium versions of their products, or bells and whistles to consumers that come with a price.The common theme among the four companies, which included LinkedIn ( LNKD), Pandora Media ( P), Groupon ( GRPN) and Facebook ( FB), was that they all offered interesting products, but I'd never spend a dime on any of them. No bells and whistles for this cheap value investor, and not one thin dime of investment capital in any of their stocks. One year later, it's time to see how they've done; where my decision to avoid these stocks has paid off, and where it has not. I'll take the pain first. Since that column ran, LinkedIn is up nearly 67%. First quarter revenue rose more than 72%, and the company earned 45 cents per share, well ahead of the 31 cents estimate. The company now trades for 88 times 2014 consensus earnings estimates, and 9.6 times 2014 consensus revenue. As much as I like and use LinkedIn, that valuation seems ridiculous to me, the value investor who has difficulty grasping the growth thing. LNKD data by YCharts
Pandora has also had a nice run, with the stock rising about 50% in the past year. Pandora has been a constant companion during the many hours I've spent rebuilding our flooded Jersey shore property; the free version that is. I still won't pay up for the no-commercial version.
Pandora has also seen some solid growth, with fourth quarter revenue up nearly 54%. The company is not currently profitable, however, although consensus estimates are calling for a penny of earnings in fiscal 2014, and 19 cents in 2015. That puts the forward price earnings ratio for 2015 at 85. Once again, love the product, but not the stock.
At its current price of $7, the stock trades at about 25 times 2014 consensus earnings estimates, and 1.7 times consensus revenue. In that respect, this may be the "cheapest" of the bunch, but still not my cup of tea. GRPN data by YCharts
The question here though, is whether there is "Facebook fatigue" happening among users, and in the end, whether this is all just a fad. While $9.5 billion in cash and securities is real, I'm not sure this company is worth its $62 billion market cap. Time will tell. Are any other Facebook users tired of seeing what little Bobby ate for breakfast that day? FB data by YCharts
What do I know? I'm just a simple value investor. At the time of publication the author held no positions in any of the stocks mentioned. Follow @JonMHellerCFA This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.