Stocks started the week off down as European worries continued to drag. So just because your stock strapped on a rocket pack and went higher, resist the urge to high-five everyone in the cubicles next to you. Smart investors won't celebrate until they know that upward leap was justified. Without a fundamental basis for the bounce, these stocks can quickly make the return trip down.

Is now the time to lock in profits, or is this just the first step toward even higher valuations down the road? Let's examine several stocks that just hit the afterburners and see whether they're truly headed into orbit.

Stock

CAPS Rating (out of 5)

Monday's Change

Winn-Dixie Stores (NAS: WINN) *** 70.2%
VirnetX Holdings (ASE: VHC) * 17.7%
LDK Solar (NYS: LDK) ** 11.2%

The markets fell 100 points yesterday, or almost 1%, so stocks that went appreciably higher are pretty big deals.

When you're hot, you're hot
From bankruptcy to privately held, supermarket chain Winn-Dixie is making the round trip through the public markets.

It emerged from court protection in 2006 but was never able to gain much traction as more nimble operators such as Kroger (NYS: KR) and large mass merchandisers like Wal-Mart (NYS: WMT) took share from the grocer. Its last quarterly earnings report exemplified the problems it faced, as revenues fell slightly and losses exploded. Although it believed the roughest road was behind it, Winn-Dixie couldn't pass up the rich premium Bi-Lo, a large, private grocery chain in the south, was willing to pay.

Bi-Lo will pay Winn-Dixie shareholders $9.50 a share -- a 75% premium -- to gain control of the 484 stores the chain operates across a number of southern states. The combined company will have nearly 700 stores in eight states, and though its ticker will disappear from the exchanges, the store name will remain because of its ready recognition.

There's little sense in adding Winn-Dixie to your watchlist, but tell us in the comments section below which grocery store is your favorite and add it to the Fool's free portfolio tracker.

Call off the dogs
It's a win one-lose one situation for Apple (NAS: AAPL) , which won a decision against HTC for violating some patents and forced its rival to withdraw some models from the U.S. market. But it also lost out to VirnetX Holdings after the U.S. patent office denied a request to re-examine VirnetX's '180 patent.

For VirnetX, the ruling is significant because it puts it in a better position for the Markman hearing scheduled for the beginning of January. Markman hearings iron out interpretations of various patent claims before a trial begins, and the 4G security specialist has patent infringement claims against Apple and Cisco, among others.

After bankrupt Nortel's patent portfolio got sold for $4.5 billion and Motorola Mobility got bought out for $12.5 billion, investors thought the bevy of patents VirnetX held might attract some buyers. But as InterDigital (NAS: IDCC) has discovered, the market has cooled considerably for wireless patents. That means protecting its patents will be VirnetX's primary pursuit for the foreseeable future.

The CAPS community is also skeptical, as just 59% of those rating it see it going on to beat the indexes, while All-Stars have lined up against it, with two-thirds of those weighing in seeing it coming up short. You can add VirnetX to your watchlist to stay on top of the legal proceedings, and you can share your thoughts on the VirnetX Holdings CAPS page.

Blowing in the wind
There was no company-specific news to account for LDK Solar's jump yesterday, which almost guarantees it will be a fleeting bit of glory. Solar can find success only as a pseudo-ward of the state, taking taxpayer subsidies to survive. Yet it seems they use these monies to their own detriment, as producers churn out ever greater amounts of polysilicon, driving down prices and wreaking havoc on margins.

Proponents like to say fossil fuels are heavily subsidized, too, but any oil-industry tax deduction or credit is similar to ones available to all businesses, such as being able to deduct intangible drilling costs (similar to R&D deductions) or percentage depletion deductions (also available to gold and iron-ore miners, among others). The alt-fuel crowd is receiving direct handouts, and without them I don't believe the market can sustain demand.

Some 1,500 CAPS members have weighed in on LDK, and 91% think it will outperform the market. I just indicated my belief that it can't go on to beat the Street, so while I'm in the minority, the low two-star CAPS rating assigned to the solar shop suggests that even the majority thinks there are better places for your money.

Tell us in the comments section below whether you agree that the only hope this business has is for the government to keep propping it up, and then add LDK Solar to your watchlist for updates on its progress.

Going into orbit
These three companies may have dicey futures despite their short-term bounce, so check out for free two companies The Motley Fool thinks have a can't-fail future. Hurry, though, because the free look is available for a limited time only.

At the time this article was published Fool contributor Rich Duprey owns shares of Cisco Systems, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Apple, Wal-Mart Stores, and Cisco Systems and has created a bull call spread position on Cisco Systems. Motley Fool newsletter services have recommended buying shares of InterDigital, Apple, Cisco Systems, and Wal-Mart, creating a diagonal call position in Wal-Mart Stores, and creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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