Do bad movies make a bad business for IMAX (NYSE: IMAX)? If the summer of 2011 is any indication, that's exactly what investors think of IMAX. The stock was a market darling until June, when it began to appear that a weak slate of movies would have a bigger impact on IMAX's earnings than had been expected.

Some also pointed to slower theater expansion, instead of what IMAX could be accomplishing, as the reason the stock is in the dumps. But the fact is that IMAX installed 84 theaters in the first half of 2011, up from 40 in the first half of 2010. Management has increased the amount of expected installations multiple times this year, something I expect to continue.

So is IMAX's stock a value we should be jumping on right now? Considering that I made it my stock pick of 2011, this Fool has a lot riding on the line.

All about the blockbuster
The mega blockbuster action flick is the best thing that IMAX has going for it. When a film like Avatar is released, IMAX can't seem to count the box office receipts fast enough. That's wonderful when Hollywood is on top of its game, but with Super 8, Thor, and Cowboys & Aliens highlighting this summer's disappointment, there's two sides of the coin for IMAX.

But next year looks to be shaping up better for IMAX. Time Warner (NYSE: TWX) unit Warner Brothers is releasing The Dark Knight Rises and The Hobbit: An Unexpected Journey, while Sony (NYSE: SNE) is coming out with The Amazing Spider-Man. The movie slate should be stronger than what we saw in 2011.

Growth overseas
International sales are also becoming an increasingly important part of IMAX's operations. The company has 153 theaters abroad compared with 264 domestically, but more importantly it sees the potential for twice as many international theaters as domestic.

International theaters are much more profitable than U.S. theaters, averaging $2.4 million in box office during 2010 compared with $1.6 million domestically. Through July in 2011, the gap has widened to $1.05 million in international box office and $600,000 domestically. With more than half of the company's backlog abroad and giant markets like China growing at a fast clip, this should drive IMAX's growth.

Foolish bottom line
So is IMAX worth betting on right now? I think the market has forgotten just how much earnings potential IMAX has when the right movies are released. Outside of Harry Potter and the Deathly Hallows: Part 2 and Transformers: Dark of the Moon, the year hasn't had much in the way of memorable movies.

I think the backlash against IMAX and 3-D outfitter RealD (NYSE: RLD) is overblown given the absence of blockbuster films this year. I expect more ahead and still see IMAX as a great value going forward.

Interested in reading more about IMAX? Click here to add it to My Watchlist, which will find all of our Foolish analysis on this stock.