Walt Disney Co (DIS) Shouldn’t Marry Twitter Inc (TWTR): Analyst

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Walt Disney Co (DIS) Shouldn’t Marry Twitter Inc (TWTR): Analyst

Walt Disney Co (NYSE:DIS) seems interested in acquiring social media company Twitter Inc (TWTR), which is up for sale. But according to one Wall Street analyst, the $147.18-billion market cap entertainment firm should looking into something in the video game or content space, not Twitter.

Nomura Securities analyst Anthony DiClemente said in a CNBC program on Tuesday said that the Twitter-Disney deal wouldn’t be a good fit.

Reports suggest that Twitter is talks with a number of technology companies to sell itself. The list of potential suitors include Google parent Alphabet, Salesforce.com, Walt Disney and Microsoft.

Citing unnamed sources, Bloomberg on Monday reported that Walt Disney is working with a financial adviser to evaluate a possible bid for Twitter.

Why Twitter not good for Walt Disney

In an interview with Power Lunch, DiClemente said: “It’s a very high price tag and a high multiple for Disney. We see better uses for that capital elsewhere for Disney.” The senior media and internet analyst covers both Disney and Twitter.

“We’ve covered Twitter for some time, and we can see some of the issues that Twitter has fundamentally. The issues with growth, the issues with decelerating revenue per issue, the issues with leadership that has turned over quite a bit,” the analyst said.

As we reported on Monday, Microsoft is preparing a bid for Twitter. The social media company appears to be putting itself up for sale as one of the strategies to save the business. The company has been struggling to maintain attractive revenues and keep up with the social media competition.

Twitter, however, hasn’t officially announce that it was looking for bids. On Monday, CNBC’s David Faber reported that Twitter is moving closer to a formal sale process for the company. He cited citing sources familiar with the company’s plans.

Shares of Twitter were up 1.41% in after-hours. The stock has gained more than 24% during the last five days.