South Carolina Moves Forward on Sports Betting Legalization: What It Means for the Broader Gaming Industry

South Carolina is making significant strides toward becoming the next state to legalize sports betting, with lawmakers prefiling two separate bills designed to expand gambling opportunities. This development could reshape the competitive landscape for online sports betting operators and mark an important shift in the state’s traditionally restrictive gaming stance.

Legislative Breakthrough in South Carolina

Two bills are now advancing through South Carolina’s legislative process ahead of the January 14 session. House Bill 3625, the “South Carolina Sports Wagering Act,” proposes establishing a Sports Wagering Commission to regulate and oversee sports betting operations focused exclusively on professional and collegiate sports. The bill aims to create a framework that would enable residents to legally engage in sports wagering if approved.

House Bill 3353 takes a broader approach by proposing a constitutional amendment that would legalize sports betting alongside pari-mutuel horse racing and casino gaming operations, including both electronic and table games. Following Mississippi’s funding model, revenues generated would be directed toward critical infrastructure projects, particularly highway and bridge repairs.

While these legislative efforts represent progress, South Carolina faces a well-documented headwind: the state’s historical opposition to expanded gambling. The legislative committees—Ways and Means for H.3625 and Judiciary for H.3353—will play crucial roles in determining whether either bill advances further.

Market Dynamics and Operator Performance

As states continue expanding their sports betting frameworks, the competitive intensity among major operators intensifies. Year-to-date performance data reveals a mixed picture across the industry’s leading platforms.

In key markets like New York, where sports betting remains heavily taxed, trailing month-over-year handle growth has decelerated to high-single digits as operators face stiffer year-over-year comparisons. Some platforms are also adopting more conservative promotional strategies to protect margins. Among major operators, BetMGM, Fanatics, and ESPN Bet continue driving most of the growth in the state, while competitors including DraftKings and Flutter Entertainment have experienced flatter performance.

Across Illinois, data from October highlighted the continued dominance of same-game and parlay betting, which accounted for 31% of total handle. FanDuel led this category with 40% of parlay volume, with Fanatics capturing 32%.

Week 15 NFL Betting Activity and Market Outcomes

During NFL Week 15 (December 9-15), sportsbook hold rates came in significantly below historical averages at just 5%, with NFL-specific hold reaching only 2% despite 9% hold rates on other sports. This marked the third consecutive week of depressed hold levels, leading Macquarie to lower its Q4 projection to 8.6%, below the normalized 9% average.

NFL Week 15 results created unfavorable outcomes for sportsbooks overall, according to Bank of America analysis. With 13 favorites winning outright and 12 covering the spread, favorable cover scenarios failed to materialize. Three of five most popular prop bets at major platforms hit, compounding hold pressures. Travis Hunter’s Heisman Trophy win represented the largest liability for at least one major operator during the week.

Digital Engagement and Download Trends

On the app front, FanDuel maintained leadership with 22% of downloads, followed by DraftKings at 17%. In the App Store’s sports betting category, PrizePicks secured the top ranking, with FanDuel and ESPN Media in the top five. DraftKings, Underdog, and Hard Rock ranked positions six through ten, while Dabble, Fliff, Fanatics, Bet365, ESPN Bet, and BetMGM occupied the 11-20 range.

Active user engagement showed ESPN Bet leading with 19% share, followed by DraftKings (18%) and FanDuel (17%), reflecting the competitive fragmentation across consumer-facing betting platforms.

Sector News: Corporate Actions and Regulatory Developments

Penn Entertainment unveiled the standalone Hollywood Casino app in Pennsylvania, built on proprietary technology infrastructure. The platform offers over 700 iGaming titles, daily promotions, and progressive jackpots across Android, iOS, and desktop environments. Pennsylvania customers can utilize existing ESPN Bet credentials to access the new app, creating ecosystem value for Penn’s integrated betting and gaming platform.

Gaming and Leisure Properties completed a $395 million acquisition of land and real estate assets from Bally’s Kansas City Casino and Bally’s Shreveport Casino & Hotel. The assets now fall under a cross-defaulted master lease structure generating initial annual rent of $32.2M, reflecting an 8.2% initial capitalization rate with projected first-year rent coverage of 2.2x.

In regulatory developments, Entain acknowledged that Australian authorities (AUSTRAC) have initiated civil penalty proceedings over alleged anti-money laundering and counter-terrorism financing violations. The investigation, announced in September 2022, prompted Entain Australia to implement enhanced compliance systems with completion targeted for June 2025. While the outcome remains uncertain, potential penalties could prove material.

Analyst Outlook and Valuation Shifts

Deutsche Bank revised gaming sector price targets while adjusting its valuation base from 2025 to 2026. Notable upgrades include Wynn Resorts (to $128 from $118), Las Vegas Sands (to $66 from $60), and Golden Entertainment (to $38 from $36). DraftKings received a $36 target, with rating maintained at Hold. Caesars’ target moved to $58, while Flutter Entertainment remains a Macquarie favorite, with the firm modeling a potential $600 share price within four years based on sustained U.S. market double-digit growth through 2030.

Macquarie continues favoring online gaming as the only major gaming vertical capable of sustaining double-digit growth independent of broader economic cycles. The firm believes current valuations underestimate potential upside from future iGaming legislation expansion in emerging markets like South Carolina.

Morgan Stanley downgraded Melco Resorts to Equal Weight, citing conservative margin expectations in Macau, where the firm projects mid-single-digit growth for 2025. Barclays initiated Gaming and Leisure Properties coverage with an Equal Weight rating and $55 target, highlighting the company’s transparency advantages and strategic relationships with regional gaming operators. Wells Fargo initiated Golden Entertainment coverage with an Overweight rating and $38 target, citing strong balance sheet fundamentals expected to stabilize in 2025.

Industry Implications and Forward Outlook

South Carolina’s legislative push toward sports betting legalization represents more than a single-state expansion—it signals continued momentum toward nationwide sports betting normalization. The state’s regulatory framework will likely influence other southeastern states evaluating similar measures, potentially unlocking incremental addressable market for operators already established in adjacent regions.

With the sector’s major players—DraftKings, Flutter Entertainment, MGM Resorts, Caesars, and emerging competitors like Fanatics—competing intensely in existing markets, new state authorizations like South Carolina could provide meaningful growth catalysts for platforms with efficient market entry strategies and strong promotional capabilities.