Gabelli & Co. analyst John Tinker initiated coverage of Spotify Technology SPOT, +20.71% with a hold rating on Tuesday, ahead of the stock's expected trading debut later in the day. Tinker commented that "the lack of a float combined with few platform investment opportunities could result in an initially strong stock price," but he thinks there are several risks to Spotify's business model. "Apple AAPL, -0.10% is growing faster than Spotify and has a different business model whereby music does not have to be profitable on a standalone basis," Tinker wrote. He also worries that increased scale might not result in better margins given that the record labels represent a "tight selling group with extensive catalog who may be difficult to dislodge." Finally, Tinker is concerned that the recent decline in average revenue per user means that Spotify doesn't have a lot of pricing power. He assigned a $130 private market value on the stock for 2019.