Marlins Discussing Record Deal With Giancarlo Stanton
Back in September, I ruminated on when an extension for Giancarlo Stanton might look like, and a run through the numbers gave me an estimate of $300 million over 12 years. The Marlins, reportedly, are negotiating a deal with Stanton that could be worth as much as $325 million over that same time period, so it seems like the estimates in that post weren’t too far off.
Except they kind of were, because I just eyeballed the projections and decided to be a little conservative, so the calculations were based on Stanton starting out from a +5 WAR level. Stanton’s actual Steamer projection is for 2015 is up on the site now, and it has him as a +6 WAR player for 2015, suggesting I maybe underestimated his expected value by a full win each year. Here’s the same table from that post, just starting from a +6 WAR base instead of a +5 WAR platform.
| Year | Age | WAR | $/WAR | Value | 10% Discount |
|---|---|---|---|---|---|
| 2017 | 27 | 6.0 | $7.00 | $42.00 | $37.80 |
| 2018 | 28 | 6.0 | $7.40 | $44.40 | $39.96 |
| 2019 | 29 | 6.0 | $7.70 | $46.20 | $41.58 |
| 2020 | 30 | 5.5 | $8.10 | $44.55 | $40.10 |
| 2021 | 31 | 5.0 | $8.50 | $42.50 | $38.25 |
| 2022 | 32 | 4.5 | $8.90 | $40.05 | $36.05 |
| 2023 | 33 | 4.0 | $9.40 | $37.60 | $33.84 |
| 2024 | 34 | 3.5 | $9.80 | $34.30 | $30.87 |
| 2025 | 35 | 3.0 | $10.30 | $30.90 | $27.81 |
| 2026 | 36 | 2.5 | $10.90 | $27.25 | $24.53 |
That projection values his 10 free agent years at a total of $390 million, and doesn’t include the payments he’s basically already guaranteed through arbitration. Toss in another $35 million for the two seasons before the 10 year extension kicks in, and this would suggest a value of $425 million, $100 million more than the Marlins are reportedly offering.
Yeah, I know, it sounds insane. I don’t think Stanton’s worth $425 million either. For one, the aging curve is probably not aggressive enough, especially for a guy his size with a history of knee problems. If we start his decline phase a couple of years earlier, having him drop from +6 WAR to +5.5 WAR at age-28, then the trickle-down has him end up at $313 million for the 10 free agent years, which would put him around $350 million over the life of the deal. Still a bit more than the rumored price, but definitely closer, and probably a bit more reasonable.
The other key we haven’t talked about is a potential opt-out, and how that might affect the valuation. Opt-outs are a way of giving the player non-monetary value in exchange for a lower AAV, and if the Marlins include one in an extension for Stanton, it could help them drive salaries down. Given the Marlins history of selling off players not too long after signing them, I’m guessing Stanton will demand either (or both) a no-trade and an opt-out, giving him the leverage to decide where he goes if he wants to get out of the deal.
If the opt-out is early enough in the deal, making Stanton’s commitment to the Marlins far shorter, then it could give him enough additional value to take less than the $30 million AAV he’s pretty clearly worth. We’ll do a full rundown on the deal when it’s done and the details are known, but it sounds like Stanton’s going to get a monster contract, and he deserves it.
Dave is the Managing Editor of FanGraphs.
It’s funny because Miami will be underwater by the end of this contract.
Maybe that’s what they’re counting on. If the team is dissolved in 10 years, they won’t be responsible for paying that contract.
Though this does seem to conflict with another long-rumored plan: once Marlin Park is flooded, they’ll just hire 25 actual marlins to play for the league minimum (to paid in the form of anchovies).
Marlins are cannibals?
If a Marlin eating anchovies counts as cannibalism, then so does a human eating a cow.
They must be talking $300 million instead of $400 million because it will be a much easier contract to trade in 12 months.
Is there no concern at all about his coming back from his injury? I would think that the memories of Tony Conigliaro, Dickie Thon, and Paul Blair would make management at least want to see him play again before offering him such a lucrative contract.
I’d be more concerned about a 25-year-old with knee problems, but that’s just me.
Well, we can assume that the team’s doctor’s and trainers have seen Stanton since the injury. I also never heard anything about his actual eye being injured. I’ve never heard of a player’s career being affected by chronic cheek or dental injuries.
A trainer can’t figure out what’s going on in his mind though, and the issue would be more mental than physical. How long did it take for David Wright to turn it around after getting hit by a Cain fastball? That’s not to say that Stanton will have any impact whatsoever, but I understand Hank G’s point. We won’t know until we see him play.
That’s fair enough.
But I responded to Hank the way I did because he listed players with eye injuries from HBP.
You can argue, in theory, Wright’s never recovered fully. Once he seemed to get back to hanging in at the plate is where the rest of his body (back, hammy, shoulder) started to betray him.
Don’t the Marlins have an organizational policy of not offering no-trade/opt out clauses?
They do, but they’re also now on record as saying they’d consider making an exception in Stanton’s case.
Dave – curious if you evaluated the Cabrera contract in the same way. At the time the extension was signed, Cabrera was coming off of a 7.6 WAR season and had a three-year average of over 7 WAR. Not sure what his Steamer projection was at the time, but if you were to apply a half-win drop from that 3-year average starting in his age-31 season of 2014, he would’ve been projected for 5.5 WAR in 2016 (the first year of the extension). If you then apply the same methodology as above using the same $/WAR figures, I don’t think it would look like a “ridiculous overpay,” as you termed it. It would be pretty close to what he deserved.
What is different here? Has your estimate of future $/WAR values changed?
Don’t have an answer for you, but it looks like Cameron is factoring in a little over 5% annual salary inflation. I understand that’s what the recent numbers show, but are we really comfortable assuming that 12 years out? There was virtually no growth 2008-2011, and there have been a couple of seasons in the past twenty years where salary went backwards. It’s also financially impossible for MLB salaries (and revenue) to increase above the rate of inflation *forever*.
I’m not imagining a dystopic future where Robot Bud Selig’s MLB owns most of the US economy.
The salaries will likely go up at a steeper rate in next twenty year period if anything. The only thing advertisers want to pay for is live viewing, dvr is virtually worthless to them because they can’t make people watch commercials. The only thing under 50 year olds watch live en masse is sporting events. Most of us stream or dvr scripted shows, reality television, even special events or award ceremonies. The money advertisers will be throwing towards sports is going to be insane. Just look at that new NBA deal which will bump the hard cap upwards of 30 million dollars in its first year.
The aging curves are different. Note that because of Stanton’s age, the table above has him sustaining this level of performance for 3-4 more years, then declining, where Cabrera’s decline began immediately. And aging is more like +0.75 WAR per year in your mid-to-late-30s.
The aging curves would be different, which is why my estimate begins the decline immediately in Cabrera’s age 31 season. Assuming a +0.5 WAR per year decline after his age 30 season, Cabrera’s extension according to your $/WAR values should have been for around $230 million, which is pretty close to what he got. Why was Cabrera’s extension ridiculous then?
If the answer is that aging should be more like +0.75 WAR per year in your mid 30s then why didn’t you apply that above to Stanton?
If you start Cabrera out at 5.5 war for 2016, and then lower that by half a war every year, and use the same $/war estimations you end up with Cabrera being worth about $210 million in the time during his extension, which was worth $240 million. That’s $30 million, which is quite a bit. There’s also the age factor where it’s a lot easier to dream on Stanton maintaining his performance or even getting better. Cabrera on the other hand is almost certainly had his peak already.
Using a $6.6M/WAR estimate for 2016, you end up with just over $230M in value over the course of the extension using the above methodology, so it’s hard to see how a $248M extension is a “ridiculous overpay.” Also, this valuation factors in a considerable decline, which may not happen. This contract still has upside considering that Cabrera’s closest comps through age-31 are Hank Aaron and Frank Robinson, who held their value into their late 30s.
This is an all-time great player. It’s fun to run projections and use inflated $/WAR estimates for guys like Stanton and Trout, but I just wonder why the same analysis wasn’t used for Cabrera. The Tigers employ a lot of smart people and probably do not make $248M investments without a bit of research.
Sorry if this is considered spam, but there was way too much to write in a comment here.
Essentially, no, unless you’re willing to take a bet right now that Stanton is Derek Jeter or Hank Aaron or Willie Mays, this extension is not worth it:
http://thereadzone.com/2014/11/14/a-320-million-extension-for-giancarlo-stanton-is-a-bet-against-history/
Almost every young star underperforms the aging curve used by Cameron here. I think that we need to ditch the -0.5 WAR per year structure.
Also,
I didn’t read your spam, but injuries both in terms of missing time and in terms of a higher rate of skill depreciation, are hard to evaluate. When a player misses time with an injury, he doesn’t produce anything while injured; often plays to a lesser level immediately following an injury until he’s fully healthy again (see 2013 Stanton); and may be permanently affected. Over a 12-year deal, it seems very likely that injuries will decrease his projected production to a significant degree.
Brian, I read your spam and agree with you. By needing Stanton to accrue 46 projected WAR, it feels like there’s little to no room for him *not* to be a Hall of Famer *and* justify this contract. And 7 of his Baseball Reference comps are not Hall of Famers – they’re very good players — Boog Powell, Juan Gonzalez, Bob Horner, Strawberry, Canseco, Conigliaro, and Jack Clark — that were good in their 20’s but started to slide dramatically in their 30’s. None of them would have come close to justifying this deal. Two more are Andruw Jones, who is a borderline Hall of Famer but only put up 20.4 WAR over ages 27 – 36, and Justin Upton, who has a ways to go. The most successful comp? Frank Robinson. He’s certainly an above-average Hall of Famer, but he put up 52 WAR in his age 27 through 36 seasons. 6 surplus WAR is nothing to sneeze at, but again, that’s a tough bet that Stanton becomes Frank Robinson.
Really hope the Marlins pull this off – I think it’s good for baseball; and I hope that Giancarlo avoids wearing one of those Heyward masks for the rest of his career. They look funny.
I hope he does whatever he feels is correct in order to protect his health, and that he ignores people like you who want to put aesthetics over safety.
Don’t be ridiculous. He should wear a Dave Parker mask at all times. Even in the field.
Giancarlo Stanton, aspiring musician, seeking record deal.
Starling Marte’s 6 year/31 million dollar deal last offseason is looking better and better all the time.
The problem is 6 WAR seems quite optimistic for him next year. Projecting him to increase his iso by .021 from last year when his hr/fb% was already around his career average.