What happened

Chicago Bridge & Iron (NYSE:CBI) stock surged another 15% in early trading Wednesday, after enjoying a huge 39% leap on Tuesday. By 12:15 p.m. EDT, however, Chicago Bridge's latest batch of gains had all but evaporated, and the stock is now up a bare 1.1%.

So what

So why the surge, and why the pullback? The first answer is easy. After enjoying a windfall of good news from a Delaware court, which threw out arguments that could have led to a $2 billion litigation award against Chicago Bridge & Iron on Tuesday, Chicago Bridge got more good news Wednesday.

First, Macquarie Bank in Australia -- a confirmed skeptic on Chicago Bridge stock -- raised its price target on the shares to $14 Wednesday morning. Then, Wells Fargo chimed in, upgrading Chicago Bridge stock to "outperform" and assigning the stock a price target twice as high: $28 a share.

Both analysts are reacting positively to Tuesday's legal news, and saying that by removing a $2 billion cloud that had been looming over Chicago Bridge's prospects, the stock's now worth a whole lot more than it was as recently as last week.

A cartoon figure pointing towards an upward trending graph.

Why is Chicago Bridge "going down" after first rising sharply? It's elementary, Dear Watson. Image source: Getty Images.

Now what

And yet, now might also be a good time to inject a bit of realism into our analysis. Although Chicago Bridge & Iron won a big legal victory on Tuesday, it was only one skirmish in what could still be a long legal war. Westinghouse, the loser in Tuesday's verdict, is likely to appeal it, and Chicago Bridge might not be so lucky next time around.

There's also the price tag to consider. After rising 39% in price Tuesday (plus an admittedly temporary, but still impressive 15% more Wednesday morning), you have to figure that a lot of the good news had already been baked into Chicago Bridge & Iron's stock price, leaving less room for additional upside -- and less reason to continue buying the stock.

As more and more Chicago Bridge shareholders realize that they have already "won" on this stock, we could see more of them decide it's time to declare victory and go home -- taking chips off the table, and looking for the next big opportunity.

Rich Smith has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.