Twitter's deal for NFL games unlikely to be profitable--analyst

Twitter Inc.'s deal to stream NFL games is more hype than hope for a turnaround for the stock, said analyst Evan Wilson at Pacific Crest, who believes it is "very unlikely" that the deal can be profitable. The company announced Tuesday that it won exclusive streaming rights for 10 Thursday night NFL games during the course of the 2016 regular season. Wilson said the deal, which he said could have cost Twitter around a $100 million, is U.S. centric, and is unlikely to attract a lot of new users, especially female users, which is what Twitter is currently struggling with. He said it suggests Twitter is trading margin for the hope of user growth, so any benefit to the stock should be shorter-term in nature. "We think [the deal] aligns with the company's focus on video--Vine, Periscope--but is another disappointing example of an Internet company trading margins to prevent user declines," Wilson wrote in a note to clients on Wednesday. The stock rose 1.1% in premarket trade, after slipping 0.2% on Tuesday. It has tumbled 26% year to date, while the S&P 500 has gained 0.1%.

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