If you’re skittish about the stock market – and who isn’t? – it may be time, some experts believe, to head for the hills, or at the very least, to do some selling to guard against further erosion of your assets. If you accept this negative view, the question is: Which stocks should you sell, especially among the better-known companies?

Market worry-wart Standard & Poor’s serves up a list of candidates. The advisory service, which is recommending reduced stock exposure – citing concerns such as ballooning energy prices, heightened terrorist threats, a toss-up presidential election, decelerating earnings growth, and rising interest rates – is advising investors to dump 15 well-known stocks. The following is the S &P’s list of companies to sell, plus a brief explanation of the reasoning behind the recommendation:

AFLAC: This health and life insurer, which derives more than 70% of its sales and profits from its Japanese operations, faces difficult earnings comparisons in 2005.

ALBERTSON’S: The shares of the nation’s second-largest supermarket chain have been slumping since July, but its p/e multiple, higher than its peers, does not reflect the increased competition facing the company, nor its rising costs for employee benefits.

BARNES & NOBLE: Heavy discounting will squeeze its operating margin. Likewise, the absence of a new Harry Potter novel will make sales comparisons difficult in the July quarter. What’s more, the shares, which trade above their average historic p/e, are overvalued.

BELLSOUTH: It’s continuing to lose market share in its wire line business. Further, its efforts to offset these losses through such steps as discounting, are likely to depress earnings.

BRISTOL-MYERS SQUIBB: While its pipeline holds some promise for future growth, it’s not enough to offset the $1.1 billion to $1.3 billion erosion in annual sales through 2007 from patent expirations. Concerns remain about an ongoing investigation by regulators of the company’s accounting.

CALLAWAY GOLF: There may be a delay in the recovery of the wood club business. Also, the gross margin should continue to come under pressure, as competition has led to sharp price cuts. Further, Callaway expects a deeper loss for the current quarter than it estimated earlier.

CENTEX: The homebuilder’s valuation is likely to be hurt by its large exposure to entry-level buyers, the group which will most be affected by rising interest rates. It also has a more modest share of the top American housing markets than its peers.

CON EDISON: It should post its third consecutive year of declining operating earnings in 2004 – about $2.60 a share, versus $2.83 the year before. Although the above-average yield of 5.5% has helped support the shares, the weak earnings outlook will weigh on them.

FREDDIE MAC: The lingering effect of an investigation into the company’s accounting will hurt the shares. Also, its mortgage funding operations and investment portfolio should suffer as interest rates continue to climb.

GEORGIA-PACIFIC: Prices of its paper and wood products will decline, given the expected drop in 2005 housing starts that will likely undercut demand.

JANUS CAPITAL: The majority of the mutual fund company’s portfolios are invested in aggressive growth stocks, and we think a lack of product diversification has contributed to a loss of investor confidence and assets. There are also concerns about net redemptions, weak fund performance, turnover of personnel, and some lingering legal and regulatory matters.

LOCKHEED MARTIN: The defense contractor should continue to be weighed down by a high fixed-cost structure. Because of only modest increases in Pentagon spending, the company is not expected to generate above average sales or earnings gains.

CHARLES SCHWAB: Heightened competition will likely keep eroding its market share. Likewise, the company’s array of investment products and services often confuses prospective and existing clients.

SEARS, ROEBUCK: In the second quarter, same-store sales fell 2.9%, while earnings missed the S &P estimate by a wide mark. The retailer also misfired by focusing on basic apparel at a time when shoppers were more fashion-conscious. Its turnaround will take longer than originally expected.

UNISYS CORP.: The technology and services consulting company suffered a 3% drop in second-quarter revenues, largely because of delays in closing some contracts. There is weakness across the company’s operations in the U.S. and Latin America and in industries like financial services and transportation.

While S &P isn’t saying it officially, one veteran S &P official believes most of the 15 stocks represent solid short sales (a bet they’ll fall in price) because he believes they’re likely to perform poorly even in a rising market.

Just to toss in my two cents, practically everyone I talk to is either cautious or worried about the market – which is usually a sound contrary indicator. It suggests to me we could see a fair-sized rally, especially on the Nasdaq, after the Republican National Convention, assuming there is no major terrorist action in the interim.