Marvel Q2 earnings trail Wall Street, shares down

By John Tilak

BANGALORE (Reuters) - Marvel Entertainment Inc. (MVL.N: Quote, Profile, Research, Stock Buzz), which licenses comic book characters, reported lower-than-expected quarterly earnings and cut its toy-sales forecast for the second half of the year due to possible lower reorders from toy maker Hasbro Inc. (HAS.N: Quote, Profile, Research, Stock Buzz).

Shares of New York-based Marvel, which boasts a stable of more than 5000 characters including Spider-Man, The Incredible Hulk and X-Men, dropped more than 5 percent in afternoon trade.

Marvel shares had slid about 11 percent since the beginning of the year before Tuesday's losses. Investor fears have been stoked by doubts about the company's ability to maintain earnings growth after revenue from Spider-Man ebbs.

The company reported second-quarter earnings of 34 cents a share versus Wall Street expectations of 39 cents a share, excluding items.

Net sales rose about 20 percent to $101.5 million, but trailed market expectations of $109.3 million.

TOY TROUBLE

Marvel reduced its toy-sales forecast for the second half of 2007 to the low end of Hasbro's forecast to reflect the possibility of lower reorders, Chief Financial Officer Kenneth West said in a conference call.

Last year, Marvel shook hands with Hasbro on a five-year master toy licensing deal, giving the world's No. 2 toy maker the right to produce toys and games based on Marvel's crop of characters.