LINC: Capitalizing on the Skilled Trades Boom with a Disciplined Growth Model

The U.S. hands-on trade skills sector is undergoing a seismic shift. With infrastructure spending surging, green energy projects accelerating, and a labor shortage crisis deepening, the market is primed for explosive growth. At the heart of this transformation is Lincoln Educational Services (LINC), a company that's not only riding the wave but actively shaping it. For investors, LINC represents a rare combination of macroeconomic tailwinds, disciplined execution, and a clear-eyed focus on high-demand trades. Let's break down why this stock deserves a long position ahead of its Q2 2025 earnings release.

The Market: A Gold Rush for Skilled Labor

The U.S. Bureau of Labor Statistics (BLS) projects that skilled trades will grow between 4% and 60% through 2033, with roles like solar photovoltaic installers and wind turbine technicians leading the charge. By 2030, the labor gap in manufacturing alone could hit 2.1 million unfilled jobs. Federal funding under the Bipartisan Infrastructure Law is already creating 345,000 new trade jobs by 2027–2028, while the rise of EV charging stations, smart homes, and renewable energy infrastructure is driving demand for specialized skills.

This isn't just a short-term blip—it's a structural shift. Skilled trades are automation-proof, offer low barriers to entry, and deliver high job satisfaction (87%, per Thumbtack). For companies like LINC, which specialize in training for these roles, the market is a goldmine.

LINC's Playbook: Hybrid Learning, Strategic Expansion, and Operational Discipline

LINC's Q2 2025 results are a masterclass in capital allocation and strategic execution. Revenue hit $116.5 million, up 15.1% year-over-year, driven by a 21.8% surge in student starts and a 20.6% increase in quarter-end enrollment. Adjusted EBITDA soared to $10.5 million, a 56.4% jump, while net income turned positive at $1.6 million. These numbers aren't just strong—they're a sign of a company hitting its stride.

At the core of LINC's success is its Lincoln 10.0 hybrid model, blending hands-on training with online instruction. This approach boosts instructional efficiency while catering to students' flexibility—a critical edge in a market where convenience and ROI matter. The model has already driven a 32% spike in transportation skill trades program starts in Q2, with new campuses like Nashville Auto-Diesel College outperforming expectations.

LINC is also expanding aggressively into underserved markets. A $75–80 million capital expenditure plan for 2025 will fund new campuses in Hicksville, New York, and Houston, Texas, with regulatory approvals already in hand. The company is eyeing a dozen additional locations to meet the surging demand for skilled labor. This isn't just geographic expansion—it's a calculated move to capture market share in regions where the labor gap is most acute.

Financial Fortitude and Margin Expansion

LINC's financials tell a story of disciplined growth. Marketing efficiency has improved dramatically, with a 14% drop in cost per student start compared to 2024. This is no accident—it's the result of sharper targeting, better execution, and a market that's increasingly receptive to career-focused training. Student start growth for the first half of 2025 hit 18.1%, and while Q3 may be flat due to high prior-year comparisons, Q4 is expected to rebound to 18–20% growth.

The company's full-year 2025 guidance has been upgraded to $490–500 million in revenue and $60–65 million in adjusted EBITDA. Even more compelling is LINC's long-term ambition: to exceed $550 million in revenue and $90 million in adjusted EBITDA by 2027. With $63.7 million in liquidity and $47 million available under its credit facility, LINC has the firepower to fund its expansion without overleveraging.

Risks and Mitigations

No investment is without risks. LINC's healthcare segment saw an 8% decline in starts, partly due to a temporary enrollment pause at a specific campus. However, the company is addressing this with new leadership and strategic adjustments, expecting a rebound by 2026. Similarly, delays in Title IV drawdowns from the Department of Education have impacted short-term cash flow, but these are temporary hiccups in an otherwise robust model.

The healthcare segment's underperformance also highlights LINC's focus on profitability over diversification. By scaling back investments in less lucrative areas and doubling down on high-growth trades, LINC is prioritizing what works—a hallmark of a disciplined operator.

The Investment Case: A Long Position Ahead of Q2

With the hands-on trade skills market set to grow at a double-digit pace, LINC is uniquely positioned to capitalize. Its hybrid model, strategic campus expansions, and margin-driven execution create a compelling value proposition. The company's Q2 results—expected to show 12–15% student start growth and $10.5 million in adjusted EBITDA—will likely reinforce this narrative.

For investors, the timing is critical. With the Q2 earnings release approaching, LINC's shares are trading at a discount to its long-term growth potential. The company's ability to scale efficiently, combined with the macroeconomic tailwinds of infrastructure spending and green energy, makes it a standout play in a sector that's here to stay.

Bottom line: This is a stock for the long haul. Buy LINC now, and hold it through the next decade of skilled trades growth.