Piper Sandler Initiates as Shorts Dig In at 23% of Float

The short interest picture tells a story that cuts against the bullish narrative from the Street. Short sellers hold 22.9% of the free float — a high conviction bet against the name. That position has grown roughly 11% over the past month, adding around 1.1 million shares net. On the week, shorts were nearly flat, down just 0.05%, after a small 1.5% single-day build on August 11. The ORTEX short score is running at 67.5, near the top of its recent range, reflecting that combination of elevated positioning and building momentum. Availability in the lending market is tight but not extreme — around 103% of outstanding short interest, meaning there is roughly one share available for every share already borrowed. Cost to borrow is low at 0.55%, dipping about 10% on the week despite the monthly rise of 19%. The low cost and stable availability suggest the borrow market is not under acute stress, but the sheer size of the short position — nearly one in four free-float shares — makes any positive catalyst a meaningful squeeze risk.

Options positioning has shifted notably more bullish over the past month. The put/call ratio now reads 0.52, below its 20-day average of 0.55, and well below mid-July readings above 0.70 that suggested significant downside hedging. That shift coincides with LPTH's 11.5% gain over the past month and 4.8% rise on the week. The PCR z-score of -0.55 is modestly below average — not extreme, but the direction of travel is clearly toward calls, the opposite of the short sellers' growing conviction.

The institutional ownership flow adds another layer to watch. BlackRock added 3.3 million shares in the most recent filing period, vaulting to a 6.7% stake. Vanguard Capital Management and Tema ETFs both entered as new holders, reporting positions for the first time. The counterweight is North Run Strategic Opportunities Fund, a 10% owner and board representative, which sold 3.57 million shares at $14 in early June — a $50 million exit. North Run now holds about 4.4% of shares. That June sale at $14 creates a visible overhead reference point, given LPTH is trading below that level today.

Earnings arrive on September 17. The two most recent prints both produced initial declines: down 5% and down 10.6% on the day respectively, though the May 14 quarter recovered sharply to a 17.8% five-day gain. The pattern suggests the market has been selling the news initially before reassessing. With short interest at 23% of the float heading into that report, and a freshly initiated analyst providing near-term price anchor, the September event is shaping up as the next real test of whether the short position is a structural conviction trade or an overcrowded setup waiting to unwind.