A trio of states voted in favor of ballot measures for the legalization of sports betting and fueled buying interest for stocks of sports betting operators on the markets Wednesday morning.
Boston-based daily fantasy sports and betting operator DraftKings had its biggest rally in 3 weeks, posting gains of 6.2%, followed closely by Penn National Gaming with 6.1%, while improvement in the outlook for FanDuel fueled the rally for its parent company Flutter Entertainment, which is set for a record close in London. The most popular sports betting and online gaming exchange-traded fund (ETF), the Roundhill Sports Betting & iGaming ETF is also up, 1.8%, having posted its best trading day in more than a month on Tuesday.
Maryland Cleared the Path for Lawmakers
The referendum in Maryland asked voters whether they would allow sports and events betting at certain licensed facilities, and use generated state revenue to fund primarily public education, and residents voted in favor, 66.2%.
The state is far from legalizing the activity, though, as it is up to the General Assembly to fill in the blank slate voted by Marylanders with the details regarding the venues, online options, number of licenses and what portion of the tax proceeds will go towards public education or other uses.
Constitutional Amendment in South Dakota
Voters in South Dakota approved the proposed “Amendment B” by 58%, to allow legal sports books in the state as early as next year. The ratified constitutional amendment is also paving the way for the state’s Native American tribes to open sports books at their gaming facilities.
Much like in Maryland, residents in South Dakota voted to permit sports betting but lawmakers will have to pass follow-up legislation to determine critical details regarding the regulatory framework and tax rates on operators.
Sports Betting within Parishes in Louisiana
In Louisiana, a ballot measure that would allow betting on football games and other sports was subjected to voting in all 64 parishes in the state, letting those of them who vote in favor to introduce legal wagering on sports events.
Most of the parishes in the state voted in favor of the proposal with margins of nearly two-thirds of the votes, but, again, the launch of sports betting within these parishes will be subject to passing appropriate state laws to regulate the activity.
Voting results from these three states just confirmed broad expectations that more and more states would be willing to legalize betting on sports and the industry is still gathering pace, boasting huge other potential, besides the newly open up market of $530 million, as projected by Morgan Stanley, as the positive legislative momentum for sports betting is expected to get stronger in early 2021, when most legislative sessions begin.