Short interest reflects improving sentiment and credibility after reconciliation and acquisition:
Before the Tax Filing Reconciliaiton: 303K to 248K short interest over period 10/11 to 6/12.
After Tax Filing Reconciliation but before Acquisition: short interest dropped from 227K to 105K by 9/14/12.
Quantum drop in short interest after Huajie Acquisition: 81K on 9/28/12 and 63K on 10/15/12.
Conclusion: The systemic problem with LPH credibility and uncertainty in forward outlook has been completely reversed. Shorts realize there is a lot of upside ahead of LPH as each subsequent quarter bakes in higher and higher percent contributions from new revenues from the Huajie facility.
After doing DD, it seems this stock is very undervalued for being in a high growth industry. Spent a lot of time looking at valuation, growth history, and verification of tax filings. Short interest is low because no one wants to bet against earnings growth over the next few months.