Shares of Marvel have had a superheroic run in the past few years.

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NEW YORK (CNN/Money) - Any comic book fan knows that you should never count out a hero, even when demise seems certain.

But Wall Street didn't follow this script with Marvel Enterprises. Before "Spider-Man" came out in 2002, no analysts covered the stock and only a few institutional firms owned it.

Investors were skeptical that the company could reap long-term rewards from licensing its library of characters. Comic book movies were just a fad, right? Plus, Marvel was loaded with debt.

But there have been several more hits, including the second X-Men movie in 2003 and last year's Spider-Man sequel. And Marvel is now debt-free. As a result, sales and profits have surged during the past three years and shares of Marvel (Research) have soared nearly 650 percent since the beginning of 2002.

Now, 13 analysts follow Marvel and big mutual fund firms including Janus Capital Management, Vanguard Group and RCM Capital Management own stakes.

The company faces new challenges, however and shares are off 20 percent from their 52-week high.

Marvel is set to report its fourth quarter and full-year results for 2004 on Monday but investors will be most interested in hearing about what lies ahead. Analysts expect revenues to drop 23 percent from a year ago, largely because there won't be another Spider-Man movie this year.

In addition, the critically maligned "Elektra", released in January, was a huge flop. And since other movies based on Marvel characters, such as last year's "Blade: Trinity" and "The Punisher" as well as 2003's "Daredevil" and "Hulk", also underwhelmed at the box office, that's led to a perception that the company is a one-trick arachnid.

Robert Routh, an analyst with Jefferies, said that's a mistake. "People think about Spider-Man and nothing else and they're absolutely wrong," said Routh, adding that the company still has plenty of popular characters that it has yet to truly tap for licensing deals, such as Captain America and Thor.

Marvel, said Routh, has successfully transformed itself from one that primarily relied on low-margin toy and publishing businesses to one that mints money by selling the rights to its characters for use in movies, video games and apparel.

In the first three quarters of 2004, more than 40 percent of Marvel's sales came from licensing. By way of comparison, only 22 percent of sales were from licensing in the first nine months of 2002.

"Basically, this is a bank," Routh said.

Routh also thinks that Wall Street pays too much attention to box-office receipts and not enough to the company's net income. Marvel does not disclose how much money it makes from individual movies but Routh said Marvel's deals with several studios enable it to generate healthy profits from lower-budget films that may be perceived as flops.

To that end, analysts are predicting a 12 percent increase in earnings despite the anticipated sales decrease.

Sure, Spider-Man won't be slinging another web on the silver screen this year but Wall Street may be underestimating the potential for another big hit this summer.

The long-awaited movie version of "Fantastic Four", which chronicles the adventures of astronauts turned superheroes Mr. Fantastic, The Invisible Woman, The Human Torch and, of course, The Thing, is due out in July.

"What really drives the stock is merchandise sales and that is largely stimulated by theatrical releases," said Marla Backer, an analyst with Research Associates-Soleil, an independent research firm. "And all my media sources, including those at Toy Fair, were positive about the Fantastic Four movie."

Arvind Bhatia, an analyst with Southwest Securities, adds that a video game based on the movie made by Activision (Research) should also be a big seller and that overall, most analysts have conservative estimates for sales and profits that will be generated from "Fantastic Four" this year.

With all this in mind, Marvel's stock appears to be a bargain.

Shares trade for about 10 times 2005 estimates for earnings before interest, taxes, depreciation and amortization (EBITDA), a financial measure commonly used for valuing media companies.

According to Bhatia, Marvel's shares have traded in a range of about 7 to 23 times EBITDA estimates during the past five years and he thinks a multiple closer to its historical median of about 14 would be fair. That implies a stock price of about $26.50, more than 40 percent above current levels.

Backer said that Marvel's stock would probably continue to trade in a narrow range until more buzz builds for "Fantastic Four" in the coming months. But she said the company has a bright future, even if "Fantastic Four" fails to live up to the hype, since a third X-Men movie is due out next year and a third Spider-Man film should hit theaters in 2007.

"Marvel has a strong slate ahead. I don't think we've seen the last of the stock's appreciation at all," she said.

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Jefferies' Routh owns shares of Marvel but his firm has no investment banking ties with the company. Research Associates' Backer and Southwest Securities' Bhatia do not own shares of Marvel and their firms have no investment banking relationships with the company.