Retail is a tough place to invest if you get seasick, and shareholders in Pacific Sunwear (NASDAQ:PSUN) are sliding into a watery trough the likes of which they haven't seen for years. Well, a year at least.

Sure, a general market swoon is upping the demand for Dramamine, but Pacific Sunwear's languishing at a 52-week low, not exactly the happiest of circumstances for this Motley Fool Stock Advisor recommendation.

May sales numbers, released last week, weren't exactly terrible, but they weren't anything to write your broker about, either. Overall, sales increased 5%, but same-store sales dropped 2.6%, led by a 5% decline at the hip-hop wannabe, d.e.m.o., and a less-scary 2.2% decline at PacSun stores. That helped Pacific Sunwear finish the entire quarter with a 6.8% revenue increase on a 2% comps decrease. Come on, PacSun, this is no time to pull a Gap (NYSE:GPS) on us.

Lukewarm sales don't doom a retailer, but Pacific Sunwear's lackluster performance has come as competitors like Abercrombie & Fitch (NSYE: ANF) have done better, even when doing their worst. American Eagle Outfitters (NASDAQ:AEOS) is posting solid double-digit gains, while young chains with more street cred, such as Zumiez (NASDAQ:ZUMZ), are putting up high double-digit comps gains. (And yeah, Zumiez's 18.2% comps gain was nice, but it's still not up to the 20% at Guess? (NYSE:GES).)

But getting back to the Sun -- with a trailing P/E around 11, are we looking at value time? My answer is a big fat "no." I'm not so sure Pacific Sunwear has what it takes to live up to the current price, which is why I sold my shares a while back for a tidy gain. And I'm not jumping back in now.

While earnings have increased steadily at Pacific Sunwear for quite a while, free cash flow (FCF) has been sinking for two years (my structural free cash flow numbers show a one-year dive), and fiscal 2007 has started off behind the eightball. Even if I'm kind to the company and pretend it's got better cash earnings than it has, Pacific Sunwear needs to jack up the bottom line by more than 23% a year to look like a bargain to me.

Do you believe in 23% growth for the next five years? If so, knock yourself out. For my part, that's simply not an assumption I'm ever willing to make with a retailer in the hypercompetitive teen market. If I dial in a more doable 17%, I gauge the stock to be fairly valued at $19.50 a share.

Shaky consumer confidence and a panicked market have a way of sending mediocre retail shares into the bargain bin. Provided things haven't completely fallen apart, I'll start sniffing around PacSun when it sees $17 a share.

Pacific Sunwear is a Stock Advisor recommendation. If you want to see why a proven market-beater, Fool co-founder Tom Gardner, thinks it's got the goods to float your board, a free trial is available.

Seth Jayson has never earned the nickname "Sunshine." At the time of publication, he had shares of American Eagle and Guess?, but no positions in any other stock mentioned. View his stock holdings and Fool profile here. Gap is both a Motley Fool Inside Value and a Stock Advisor recommendation. Fool rules are here.