DoubleClick offers Google (NSDQ: GOOG) a long-term avenue to success in the display ad market, but in the short term, it will prove difficult to make the new acquisition pop. That’s the view of UBS analyst Ben Schachter, arguing in a new report that display advertising, which is largely about brand promotion, isn’t an obvious fit with Google’s traditional pay-for-performance model.

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Schachter: “While display advertising is certainly a complement to Google’s core Adwords platform, there are many important structural differences in the display business that will require Google to assimilate varying constituent objectives, incentives, and technologies in ways they may not have had to with the roll-out of Adwords. We believe it will take some time before the DoubleClick deal will positively impact Google’s overall business.”

In the meantime, the DoubleClick deal will lead to dilution from the $3.24 billion paid for the company and margin compression from the 1,500 new DoubleClick employees. The report does note the expected layoffs.

The report comes a day after Lehman analyst Doug Anmuth predicted only the slightest earnings dilution and a good opportunity to realize strategic synergies. Anmuth also urged shareholders to disregard declining paid click growth, saying it was largely the result of intended quality improvements. Schachter’s view: paid clicks are declining, but they’re not being made up for by quality improvements.

Bottom line: As Schachter puts it: “Nothing is broken”, but between the growth issues, margin pressure and DoubleClick, forecasts for Google need to come down.

—Google shares are down slightly over 1 percent in today’s trading.