Disney's strategy of buying key media content assets from Twenty-First Century Fox to beef up content for its own streaming services will not work, according to one Wall Street firm.

On Thursday, Disney announced a deal to acquire certain Twenty-First Century Fox assets including movie studios and cable entertainment properties.

"We are weighing in - negatively - with our assessment of what we expect will be the strategic rationale for the deal (positioning Disney better to compete in the OTT space) … In our view, Disney is committing significant capital to the lost cause of protecting video aggregation margins," analyst Doug Creutz wrote in a note to clients Thursday. "Taking on competitors who don't need to turn a profit is rarely a good idea."

The analyst reaffirmed his market perform rating and $94 price target for Disney shares, representing 13 percent downside to Wednesday's close.

Disney announced plans in August to launch a branded direct-to-consumer streaming service in 2019 and an ESPN streaming service in 2018.

Creutz said the internet giants like Amazon and Netflix can leverage "essentially unlimited balance sheets" to buy content.

"What we don't understand is why Disney would want to compete with Netflix, and other new media players, as a new media content aggregator," he wrote. "With even more players entering the fray (Apple, Google), and a likely willingness by at least some of them to play a long game of loss leadership in content aggregation to support other business objectives, we expect pressure on content margins."

Disney shares are underperforming the market this year. Its shares have rallied 3 percent through Wednesday versus the S&P 500's 19 percent gain.

"We think that this deal is an attempt by the Murdoch clan to eventually put themselves in position to run Disney," he wrote. "Eventual control of Disney by the Murdochs may not be the most likely outcome, but we think it is a very possible one."