Long Term Deals - Worthwhile?

Thursday, November 17 2011 @ 12:55 PM EST

Contributed by: John Northey

With talk of 7,8,9, and 10 year contracts going on for Pujols and the like I got to thinking - do these work out often or do teams really, really, really regret them.

My first thought is that any team doing over 5 years or betting $100+ million is taking a silly risk. But lets see if that is true.

Checking Cot's Contracts for the 10 biggest deals and FanGraphs dollar value (2002 and beyond - for 2001 cases I just average the others and add in, for future cases I assume average to date over years remaining) to decide if it was a good or bad deal. FanGraphs isn't perfect, but if they list you at $20 million and you made $100 million I think it is safe to say it was a disaster. Given they tend to overestimate as far as most are concerned this should be generous.

  1. Alex Rodriguez, $275,000,000 (2008-17) - $204.5 - Valuable, but odds are that estimate will get a lot worse.
  2. Alex Rodriguez, $252,000,000 (2001-10) - $247.6 - Texas got lots of buyers remorse but it actually came out close
  3. Derek Jeter, $189,000,000 (2001-10) - $175 mil - acceptable
  4. Joe Mauer, $184,000,000 (2011-18) - $63.2 - odds are it will improve, but horrid start
  5. Mark Teixeira, $180,000,000 (2009-16) - $147.5 - not horrid yet...
  6. CC Sabathia, $161,000,000 (2009-15) - $218.4 - looks like a bargain ($81 mil banked so far)
  7. Manny Ramirez, $160,000,000 (2001-08) - $111.4 - $6 mil a year lost
  8. Troy Tulowitzki, $157,750,000 (2011-20) - $282.0 - Just one year in, doubt he'll be a $28 mil a year player throughout
  9. Adrian Gonzalez, $154,000,000 (2012-18) - $? - unknown but $29.5 last year = $206.5 potentially
  10. Miguel Cabrera, $152,300,000 (2008-15) - $189.0 - looks good so far
So of the top 10 we see 1 unknown (starts in 2012 but looks promising), 3 profitable (but active so could collapse), 5 where there was value but not as much, and 1 total collapse. Actually, not too bad as you get 50-50 odds of having a strong player (ala Man-Ram or Teixeira) and just a 10% shot at 'what were we thinking?'. Still, what if we expand to the top 20 contracts...

11. Carl Crawford, $142,000,000 (2011-17) - $6.3 - Yeah, he had a horrid year
12. Todd Helton, $141,500,000 (2003-11) - $116.7 - Not as bad as I expected
13. Johan Santana, $137,500,000 (2008-13) - $70.8 - Missing a full season hurts
14. Alfonso Soriano, $136,000,000 (2007-14) - $104.8 - Not as bad as I expected
T15. Vernon Wells, $126,000,000 (2008-14) - $40.6 - Ouch!
T15. Barry Zito, $126,000,000 (2007-13) - $38.92 - Ouch squared!
T15. Jayson Werth, $126,000,000 (2011-17) - $79.8 - Yeah, we all saw that coming
18. Ryan Howard, $125,000,000 (2012-16) - $? - unknown but 2011 suggests $37 mil, his best season ever was $22.9
19. CC Sabathia, $122,000,000 (2012-16) - $? - unknown but 2011 suggests $161
20. Mike Hampton, $121,000,000 (2001-08) - $27.2 - a standard for horrid

So this group didn't do so well. Hasn't started: 2 (1 good, 1 not so good), Profitable: none, Not Bad: 2 (maybe - I'm stretching here), Ouch: 2, Super Ouch: 4 Just one suggests profits could be had (Sabathia) while all others are losses with at least 6 and probably 7 being major budget crippling losses.

Then (for fun and a tie breaker) #21 to 30.
21. Jason Giambi, $120,000,000 (2002-08) - $69.2 - Ouch
T21. Matt Holliday, $120,000,000 (2010-16) - $172.9 - Wow
T21. Cliff Lee, $120,000,000 (2011-15) - $151.5 - Just 1 year so far too early
24. Carlos Beltran, $119,000,000 (2005-11) - $133.0 - Nice, first showing a profit when complete
25. Ken Griffey Jr., $116,500,000 (2000-08) - $15.2 - 7.8 WAR in estimated years, could've added $15-30 mil in net value still ouch regardless
26. Kevin Brown, $105,000,000 (1999-2005) - $54.4 - 2 years estimated, worth 9 WAR maybe $18-36 mil in value vs $15 estimated
T27. Carlos Lee, $100,000,000 (2007-12) - $54.8 - Ouch
T27. Albert Pujols, $100,000,000 (2004-10) - $230.8 - WOW!!! No season below $25.9
29. Carlos Zambrano, $91,500,000 (2008-12) - $53.25 - Ouch and probably overestimating 2012
T30. Mike Piazza, $91,000,000 (1999-2005) - $41.8 - 2 years est at $12 mil net, WAR of 11, worth $20-40 mil
T30. Barry Bonds, $90,000,000 (2002-06) - $114.1 - Nice, even with a lost year
T30. Torii Hunter, $90,000,000 (2008-12) - $68.4 - More proof of why the Angels GM is an ex-GM
T30. Chipper Jones, $90,000,000 (2001-06) - $86.3 - Pretty close
T30. Scott Rolen, $90,000,000 (2003-10) - $136.6 - Very nice despite an injury filled season
T30. Ichiro Suzuki, $90,000,000 (2008-12) - $79.9 - Close, but depends on 2012.

A much better batch of 15. Clear wins: 4, potential wins: 2, some value: 3 (maybe), ouch: 6 (some extreme like Griffey).

So, for a summary... Total Clear Wins (ie: worth more than paid): 4 Potential Wins (on pace for win): 7 (includes some that haven't started or just 1 year in) Some Value: 10 Ouch: 14 including Howard's

So odds of a win out of these top 35 deals is 31% (counting actives), of getting at least something worthwhile 60%, of losing your job over it or wishing you did 40%.

Still sure you want the Jays to open the vault for Fielder or Pujols?

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