We seem to be in profits warning season, as some companies begin to realise that they're not going to hit their forecasts. Given the softness in the Eurozone, and UK economies, then one imagines we're likely to see more profits warnings that usual this year. So might be a good time to review the portfolio and trim back a bit on things that look vulnerable to warn? Handy to have a bit of spare cash on the sidelines too, so one can move fast to grab opportunities that arise. 

One such opportunity that I spotted yesterday was a special situation called Security Research (LON:SRG) , a very interesting small cap that won an enormous & highly profitable contract from the MoD to provide detection equipment for bombs for use in Afghanistan. The earnings are not sustainable, which they freely admit, but it has brought in a one-off cash boost, which they are returning to shareholders via a tender offer at 225p. The shares can be bought for about 125p, so I picked up a few, with the intention of tendering 1 in 5, but getting almost double the money for each share tendered. I also wonder if there is the possibility of repeat orders? You never know. DYOR as usual on this one, it does need careful thought, as it's such an unusual situation. But a tender offer at almost double the share price seems a pretty bullish signal to me.

Computer games company Zattikka (ZATT) is one of today's casualties, saying that proforma 2012 revenues will be $10-11m. Stockopedia shows that broker forecast is for $12.8m turnover in 2012. So that looks like a 10-20% share price fall on the cards for today.

Things are not going well at Stadium Group (SDM), a £15m mkt cap electronics company. I see that broker forecasts have already been lowered considerably throughout 2012, but they've warned today that H2 profits will be below H1, and therefore the full year will be "significantly below current market expectations". Not good that, so a sharp drop likely here too. Although they do say that a Hong Kong property disposal will realise a £3m one-off cash inflow, and £2.2m exceptional profit, and that they are confident of an improved 2013. So I might put this on the…

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