Email a copy of 'Freddie Freeman And The Changing Extension Market' to a friend
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By Jeff Todd | at
Email a copy of 'Freddie Freeman And The Changing Extension Market' to a friend
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jimithin9
Gotta work Longoria’s extension into the conversation here!
Jeff Todd
I’d say he fits in the Braun category, except his first deal was signed only 6 games into his career. The 2nd deal was signed w/4 years of control left on the original deal, and at a point at which he’d established himself as an elite player.
GrilledCheese39
Saw you mentioned Pedro Alvarez in there.. Any prediction on what the price could be on a hypothetical extension?
Jeff Todd
I’d certainly hate to throw out a number without doing a detailed analysis. Even then, I’m not sure how useful it would be.
With the Bucs’ spending habits and value focus, a guy like Alvarez could potentially end up as an example of what I pointed out in the article: whatever we might think constitutes the market rate for a player, extension negotiations are a one-on-one affair. It only takes one of thirty clubs to give more years or money to a free agent, but extensions only happen when a player is willing to take what the team is willing to offer (if anything).
He is somewhat less desirable as an extension candidate than a guy like Freeman. Though his power is undeniable, he has not quite matched Freeman’s 2013 in terms of overall value. He’s slightly older at 27 and has the strikeout/lack of OBP issues. FWIW, Oliver/Steamer projections like him to remain a 3-3.5 win guy, while PECOTA forecasts a slight drop in power w/continued OBP issues.
So, with no basis but my own supposition, I’d suggest that it could be a situation where the team says: “Here’s what we’re willing to do. May not be ‘market’, and you can surely make more if you wait, but we’re only interested if we get a legitimate discount.”
In that hypothetical, it would come down to whether or not the player is willing to take the risk. Alvarez already has earned $10MM, and stands to get another big arb payday next year, so he isn’t exactly desperate to get his first big score.
Sum: who knows, but that’s one way in which, I think, the “old model” of extensions could still be relevant.
johnsilver
Adam Dunn without any plate discipline ring any bells?
Jeff Todd
What he loses in OBP to Dunn, he probably makes up by playing a serviceable 3B. He obviously doesn’t seem destined for superstardom, but Alvarez is a plenty useful player.
(Side note: Dunn’s defense rated so poorly in 2009 that he landed below replacement level, per B-R, despite a .928 OPS.)
johnsilver
I understand, though do wonder how long he + defense will hold up. He is a big man.
Frank Howard type is another he reminds me of Jeff, though Hondo was an OF defensively. The offensive end and approach is an almost identical match and moreso than that of Dunn.
He is one of the Boras clients IMO who should seek a LT deal as I don’t think his career will be a long one and not saying that to be spiteful, or mean. Just that his good years will be short is my 2c and hope that he signs a LT deal, or at least one to carry through his arbitration and 1st couple of FA years.
Jeff Todd
Added a note to the piece to the same effect as my comment. Thanks for pointing out.
bjsguess
I think Cameron is dead on with most things … but not on this.
It’s hard to compare this deal to many of the others cited simply because the dollars and years weren’t close. Most of the other deals involved buying out 2 years of FA. This deal starts earlier and lasts longer than most of those comps. The closest comp really is Andrus. Just one year later which team would take on that contract without any additional cash coming from the Rangers? I’d guess nobody.
It’s not the end of the world when Brett Anderson has his elbow blow up. If he never pitched another day in his career after signing that extension the total risk was $12.5M. AND they were able to secure 2 below market CLUB options. With Freeman you are talking about laying $135M on the line. That is a HUGE amount of money to commit to a player that was worth exactly 2.5 WAR over the course of his first 2 combined seasons. Put another way, it was easy to see the Anderson deal being very team friendly when he signed it. I don’t see how anyone could claim this as a bargain for the Braves.
At the end of the day, if this is the new norm I’m predicting we see another change in direction. Clubs won’t be looking to secure their players at a young age. If the cost is paying a premium for their arb years + market rate for the FA years I just don’t get it. The risk is way to heavily slanted in the players favor. Sure if you go year to year you run the chance of a player blowing up and pricing him off your team when they hit FA. However, I’d take that risk knowing just how many players wash out after a good couple of seasons. Most teams can’t afford to have 3-5 $100M mistakes on their books. If this trend continues then that’s exactly what will happen.
Bob Bunker
I completely agree with this. I don’t see the bargain side of the extension at all and if players continue to demand similar extension I could see teams just flatly refusing give out 135 million to guys like Freeman where best case he is worth 150 million and worst case he is worth 90 million and the team ends up paying far more than the player provides. Just doesn’t make sense.
Lance Pistachio
It seems like the trend of teams extending their big stars before they hit free agency is driving up the cost on extensions overall.
Or the Braves just overpaid. Time will tell
Jeff Todd
I don’t think that Cameron (or myself, for that matter) passed any real value judgment on the deal. He wasn’t necessarily saying it was “good” because it reflected what he terms a market correction. He was pointing out that it was more a correction than an outlier in comparison to past deals, which have ended up looking (arguably) overly team-friendly.
That being said, I do agree that his point is somewhat overstated, which is really why I wrote this post. For the reasons you note, and those I gave, some teams in some situations will continue to demand significant discounts to give out extensions. How often players bite, and the extent to which the market rises as a whole, remains to be seen.
Very different context due to age, but heck, the Sox just promised less cash to Pedroia (a fully established 5-8 win player) than Freeman got — and he was a year closer to free agency.
bjsguess
Thanks Jeff. When I hear “correction” I immediately think that the transaction is more “right” than it was in the past. This is reinforced by Cameron citing all of those deals. That said, Dave (and you) weren’t saying this is how it should be – only that this could be a new trend that is developing.
At the end of the day this all about risk. Teams have to weigh a players probability for injury or regression in ability against the potential upside they bring if they continue to improve. I see Freeman as being worth a minimum of $5M (his number this year). If he suffers a catastrophic injury this season that’s all you have to pay. If he plays like he did in 2011/12 then you are looking at maybe another $16M or so combined for the 2 years. If he continues to play like he did in 2013 that number jumps up to $23M combined for his last 2 years of arb.
Then with FA I see his upside as $22M/year (consistent 4-5 WAR player). On the low-end, if he is just another average 1B – maybe $12M (think Adam LaRoche) annually. Again, I think you can split the difference with a slight favor towards the club since you are doing this 5 years in advance. That puts the value at maybe $16M AAV. That would peg his overall value at 8/$105M. Even that seems a little rich for me. I’d probably throw in some sort of an injury out at maximizes my exposure to the first 6 years in the case of a catastrophic injury. Give Freeman an opt-out as well around year 6 so that he can leave if he does turn into a superstar.
jury_rigger
The Andrus contract is terrible
kungfucampby
It was so terrible for Texas I have no clue what they were thinking.
ElGaupo77
If the Braves manage his service time a little better this contract is a lot smaller. Losing the one year of control by bringing him up opening day his rookie year cost them about $15M.
Jeff 31
If Heyward wasn’t brought up opening day, Braves miss playoffs in 2010. Contenders have to try to win now.
NL_East_Rivalry
The year was weird when they brought Freeman in. Kimbrel, Minor, and Freddie were all ROY contenders and the Braves missed out of the play-offs. Gotta love it when a team just falls apart.
Travis W.
If the Royals are going to lock Hosmer up with Freeman type of money, they need to do it now. The main problem is that Hosmer is a Boras client and Boras likes to take his players to the free agent market. I feel that Hosmer is still a buy low option at this time, but may not be for long if his second half from last season carries over.
bjsguess
Boras is always about maximizing his players earning potential. If the Royals offered this deal he should jump on it. It is already a significant overpay for Freeman and Freeman so far has demolished Hosmer when it comes to actual contributions.
As for Hosmer’s 2nd half … it really wasn’t much better than his first.
285/332/427
323/379/473
That looks significant but the real reason the numbers jumped … 310 BABIP vs 368 BABIP in the 2nd half. His ISO only rose from 142 to 151. His wRC increased from 46.1 to 47.4. Basically, when you normalize his BABIP the 2 halves are nearly identical … they are, for all intents and purposes, the same. Now, if you think that Hosmer is the kind of guy who will post BABIP in the 370 range then sure, count on a 2nd half repeat. Me? I’ll take the under on that. His career average was much closer to his first half number. Consistently posting a 370 BABIP is really the realm of speedsters (Trout) or outstanding hitters (like Cabrera).
Travis W.
I like your numbers. You obviously have a copy of baseball prospectus and have done your homework. You don’t see a big difference in the first and second half numbers? You also have to consider he has only played two and a half years, he is still figuring it out. You have to also consider where he plays. Kaufman isn’t exactly a hitters park. I am not saying he is as good as Freeman, but he isn’t far behind. He also has a gold glove on his resume. Baseball numbers are fun, but there is more to it then that. Look how often he pulled the ball in the second half, look at how many more line drives he hit. Now consider, that he will also have a legitimate leadoff man in front of him, and two quality hitters behind him this year. Me, I’ll take odds on that 370 BABIP.
Alex 30
I’ve been reading MLBTRADERUMORS for 6 years and this is among my favorite, if not my favorite, post thus far. Excellently written and an interesting/provocative argument.