South Carolina Advances Sports Betting Legalization as Industry Momentum Builds

South Carolina is making significant strides toward legalizing sports betting, with lawmakers prefiling two major bills that could reshape the state’s gaming landscape. The legislative push represents a critical moment for the state, which has historically maintained strong opposition to gambling expansion. However, momentum in the broader iGaming sector and successful implementations in neighboring states are creating new opportunities for South Carolina to modernize its regulatory framework and capture economic benefits from legal sports betting.

Comprehensive Sports Betting and Gaming Legislation Takes Shape

South Carolina lawmakers have introduced two distinct legislative proposals to expand legal gambling within the state, each taking a different approach to regulation and scope.

House Bill 3625, known as the “South Carolina Sports Wagering Act,” focuses exclusively on legalizing sports betting. The bill proposes establishing a Sports Wagering Commission to regulate the industry, enabling South Carolinians to legally wager on professional and collegiate sports if approved. This targeted approach would allow residents to place bets on major sports events while maintaining restrictions on other forms of gaming.

House Bill 3353 takes a more ambitious path, proposing a constitutional amendment that would legalize not only sports betting but also pari-mutuel horse race betting and casino gaming, including both electronic and table games. Under this broader framework, revenues generated from these gaming activities would be directed toward infrastructure projects such as highway and bridge repairs. This funding model mirrors the approach adopted by Mississippi, which has successfully used sports betting revenues to support public infrastructure investments.

Both bills face consideration in the upcoming legislative session. H.3625 has been referred to the House Ways and Means Committee, while H.3353 was assigned to the House Judiciary Committee. The January 14 legislative session represents a critical juncture for advancing these proposals through committee review and floor consideration.

Industry Players Respond to Emerging Opportunities

The potential legalization of sports betting in South Carolina is already prompting significant moves from major gaming operators seeking to position themselves for market entry.

Penn Entertainment recently demonstrated its commitment to expanding its iGaming presence by launching its proprietary Hollywood Casino app in Pennsylvania. The standalone application offers more than 700 iCasino games, daily promotions, and progressive jackpots. Available across Android, iOS, and desktop platforms, the Hollywood Casino app provides a seamless experience with ESPN Bet, as users can access both platforms using the same login credentials. Penn has signaled plans to expand the Hollywood Casino brand into additional jurisdictions throughout 2025 and beyond, pending regulatory approvals. Such expansion efforts suggest the company is preparing infrastructure to enter new markets, potentially including South Carolina should the state approve sports betting legislation.

Meanwhile, Gaming and Leisure Properties completed its previously announced $395 million acquisition of land and real estate assets from Bally’s Kansas City Casino and Bally’s Shreveport Casino & Hotel. The acquisition reflects continued consolidation and refinement within the gaming REIT sector, with the properties now operating under a new Bally’s master lease structure. Initial annual cash rent totals $32.2 million, representing an 8.2% initial cash capitalization rate. The transaction underscores the ongoing strategic positioning by major operators to strengthen their regional portfolios ahead of potential market expansions.

Market Dynamics and Consumer Engagement Trends

The online sports betting and iGaming market continues to demonstrate resilience despite challenging competitive dynamics in certain jurisdictions.

Recent market analysis from Macquarie indicated that during late 2024, the sports betting market hold averaged around 5%, with NFL wagering holding at approximately 2% and other sports at 9%. These hold levels remained below historical averages, reflecting intense competitive pressures and promotional activity among operators. For the full year 2024, Macquarie projected normalized market hold at approximately 8.6%, below the historical average of 9%, signaling that competitive intensity is structurally impacting operator margins.

In New York, one of the nation’s most lucrative but heavily taxed sports betting markets, handle growth has decelerated to high-single digits. The slowdown reflects tougher year-over-year comparisons as the market matures, combined with more conservative promotional strategies adopted by operators navigating the state’s elevated tax environment. Most of New York’s growth has been concentrated among BetMGM, Fanatics, and ESPN Bet, while DraftKings and Flutter Entertainment have seen flat performance and Caesars and Rush Street Interactive have posted declines compared to the prior year.

Consumer engagement metrics reveal shifting preferences in sports betting product adoption. In Illinois, parlays and same-game parlays have grown to represent 31% of overall handle. FanDuel leads this category with a 40% share, while Fanatics holds 32%. This trend suggests operators must develop sophisticated parlay product offerings to remain competitive as consumers increasingly favor these high-variance wagering options.

On the mobile platform front, FanDuel maintains market leadership with approximately 22% download share, followed by DraftKings at 17%. In app store rankings within the sports category, PrizePicks has captured the top position, with FanDuel and ESPN Media following in the top five. DraftKings, Underdog, and Hard Rock ranked between six and ten, while a competitive tier of apps including Dabble, Fliff, Fanatics, Bet365, ESPN Bet, and BetMGM occupied positions 11-20.

Gaming Sector Stock Performance and Analyst Outlooks

The potential expansion of legal sports betting into new jurisdictions, including South Carolina, is generating renewed analyst interest in gaming and iGaming stocks.

Deutsche Bank updated its gaming sector models and adjusted price targets across multiple operators. Wynn Resorts saw its price target increased to $128 from $118 with a maintained Buy rating, reflecting confidence in the company’s operational execution and market positioning. Sportradar received an upgrade to $19 from $18 with a Buy rating. MGM Resorts had its target raised to $49 from $48, while Light & Wonder was adjusted to $89 from $78 with a Hold rating. Las Vegas Sands saw an increase to $66 from $60 with a Buy recommendation. Golden Entertainment received an upgrade to $38 from $36 with a Buy rating.

DraftKings, a key beneficiary of potential sports betting expansion, received a modest price target increase to $36 from $33, though Deutsche Bank maintained a Hold rating. Caesars was adjusted to $58 from $56 with a Buy rating. Gaming and Leisure Properties, the REIT that owns many gaming facilities, received a target increase to $58 from $54 with a Buy rating. Boyd Gaming was raised to $79 from $72 with a Hold rating. Accel Entertainment received an upgrade to $15 from $14 with a Buy rating.

Beyond Deutsche Bank, Argus upgraded Boyd Gaming to Buy from Hold with a $90 price target, citing improving operational momentum. Morgan Stanley, by contrast, took a more cautious stance on Asian gaming exposure, downgrading Melco Resorts to Equal Weight from Overweight with a price target of $7.50, down from $9.60. The firm noted that Macau gaming gross gaming revenue and EBITDA could experience only mid-single digit growth in 2025, below consensus expectations.

Barclays initiated coverage of Gaming and Leisure Properties with an Equal Weight rating and $55 price target. The analyst noted that while Gaming and Leisure Properties may not operate the highest-quality assets relative to peers, the company offers greater transparency regarding rent coverage for the vast majority of its leases and maintains strategic relationships with Bally’s, Cordish, and the Ione Band of Miwok Indians. These relationships and operational transparency provide meaningful value to investors navigating the competitive REIT landscape.

Wells Fargo initiated coverage of Golden Entertainment with an Overweight rating and $38 price target, characterizing the company as “a simple story” with a strong balance sheet and a proactive management team exploring strategic alternatives. The firm expects fundamentals to stabilize during 2025, with current valuations appearing reasonable for a company positioned to benefit from industry consolidation and potential market expansion.

South Carolina’s Significance in the Broader Regulatory Landscape

South Carolina’s efforts to legalize sports betting hold particular importance given the state’s historical resistance to gambling expansion. Unlike many western and northeastern states that have embraced sports betting in recent years, South Carolina has maintained a more restrictive gambling posture. The introduction of bills to legalize sports betting—particularly the broader H.3353 that would establish a constitutional amendment framework—represents a potential turning point for the region.

Success in South Carolina could establish a template for other southeastern states considering sports betting legalization, particularly given the state’s size and population. A South Carolina sports betting market would join existing legal markets in bordering states and create additional migration pathways for consumer spending. Furthermore, the potential incorporation of revenue-sharing frameworks for infrastructure development, as contemplated in H.3353, could provide an attractive model for other states seeking to balance gaming expansion with public benefit requirements.

The competitive intensity evident in mature markets like New York and Illinois underscores the importance of timely market entry for operators seeking to establish brand presence and customer relationships early. For major platforms like DraftKings, Flutter, and others, securing early access to the South Carolina market ahead of potential competitors would provide significant competitive advantages.

As South Carolina’s legislative process unfolds, the state’s decisions regarding sports betting regulation will offer important insights into the evolving national framework for iGaming and gambling expansion. The outcome of these legislative efforts could influence both industry planning and investor sentiment toward gaming sector equities.