Revisiting Last Year’s Free-Agent Signings

Before all our attention is focused on the post-season, I thought I’s take a quick look back at free agent signings from the past year and how those deals worked out in 2012. The focus here is just on what teams got for their money. In other words: Did the players meet or exceed the expected value of the contracts they signed?

I focused on major league signings only, so the analysis does not include myriad minor league deals — many of which resulted in players accumulating playing time in the majors this year.

To get a sense of the how the deals turned out, I compared players’ expected values — which are based on their positions and the annual average value (AAV) of their contracts — to their actual values. I uses Matt Swartz’s research on the differences in dollars per Wins Above Replacement (WAR) by position, rather than assume an average dollar-per-WAR, as is typically done.

For reference, here are the positional averages from 2007 through 2011:

$/WAR 2007-11	POSITION
$10,700,000.00	RP
$6,300,000.00	CF
$6,100,000.00	1B
$4,900,000.00	LF
$4,600,000.00	DH
$4,400,000.00	RF
$4,000,000.00	SP
$3,900,000.00	3B
$3,100,000.00	C
$3,000,000.00	SS
$2,500,000.00	2B

Using these multipliers, I calculated expected WAR for 2012 by dividing the AAV of each player’s contract by the estimated $/WAR based on their position.

On balance, teams did a pretty good job of valuing players and signing them to appropriate deals. The 111 signings under examination here were expected to produce 102.8 WAR and so far have produced 115. Fifty-one of the signings produced more value than expected, while 60 produced less value. Looking at the frequency of differences between expected and actual WAR, we see that there were more players outperforming their expected WAR by greater than 1 WAR than there were players who underperformed by more than 1 WAR (18 versus five).

Let’s take a look at how the signings turned out when considering positions:

POSITION	N	Exp WAR	Actual WAR	Difference
3B	8	0.8	1.4	0.7
LF	10	0.5	1.1	0.6
2B	6	1.2	1.6	0.4
DH	3	0.6	0.9	0.3
CF	2	1.0	1.3	0.3
RF	7	1.4	1.6	0.2
SP	18	1.6	1.7	0.2
RP	30	0.3	0.3	0.0
C	11	0.5	0.3	-0.2
1B	7	1.5	1.2	-0.3
SS	9	1.9	1.5	-0.4

Shortstop was expected to produce the most average WAR — driven mostly by the Marlins signing Jose Reyes. Reyes was initially valued at 6.2 WAR this year, but he’s only accounted for 4.5 WAR. And while Reyes was the biggest disappointment at his position, he wasn’t the only shortstop to underperform his contract. Alex Gonzalez and Jack Wilson all underperformed by 1.1 WAR.

The greatest additional value this year has been provided by third basemen (+.7), followed by left fielders (+.6). Eight third basemen were signed and were expected to produce .8 WAR, on average. Outside of Aramis Ramirez, no other third basemen was expected to produce more than .8 WAR. Ramirez has certainly outperformed his expected WAR this year (+3) — but right on his heels, in terms of additional value, has been Tampa Bay’s Jeff Keppinger (2.7 WAR versus .4 expected WAR). Greg Dobbs has been the biggest disappointment, giving -1.2 WAR while Miami assumed .4 this year.

The Twins grabbed one of the greatest bargins out of left field with Josh Willingham and his 3.8 WAR — 2.5 more than expected. Ryan Ludwick has been huge for the Reds this season, considering the team’s offense has been average (+2.5 WAR). The New York Mets resigned Scott Hairston for $1.1M, but have been treated to a 2.1-WAR season (+1.9) thanks to his production against left-handed pitching (137 wRC+). On the negative side of the ledger, Endy Chavez was supposed to produce roughly .3 WAR for Orioles but posted -.9 WAR for the season.

We can also look at how teams did, overall, looking at their signings as a portfolio:

Team	# of Free Agents	Average WAR above Expected
Texas	2	1.8
Oakland	4	1.4
Boston	3	1.0
Cincinnati	2	0.8
Tampa Bay	5	0.7
Milwaukee	3	0.6
Arizona	8	0.5
Chicago Cubs	4	0.4
NY Mets	4	0.4
Minnesota	6	0.4
Detroit	4	0.4
NY Yankees	3	0.3
Seattle	4	0.2
LA Dodgers	9	0.1
Kansas City	4	0.1
Philadelphia	7	0.1
Baltimore	5	0.0
San Diego	2	-0.2
Pittsburgh	4	-0.3
Toronto	2	-0.3
Chicago Sox	1	-0.3
San Francisco	4	-0.3
Houston	1	-0.4
St. Louis	3	-0.5
Washington	4	-0.5
LA Angels	3	-0.6
Cleveland	2	-1.1
Atlanta	1	-1.1
Colorado	3	-1.2
Miami	4	-1.3

The Rangers, Athletics and Red Sox were the only teams that averaged at least 1 additional WAR per signing. Suprisingly, Oakland’s numbers were not fueled by Yoenis Cespedes — who has been about even in terms of expected and actual WAR — but by Jonny Gomes (+1.3), Coco Crisp (+1.5) and Bartolo Colon (+2.1). Boston benefitted mostly from batt-flipping Cody Ross (+2.0), who posted almost 3 WAR manning right field for the Sox. Texas saw the most additional value from its two free-agent signings: Joe Nathan (+1.1 WAR) and Yu Darvish* (+2.4 WAR) have both been outstanding — posting a 60 and 74 FIP-, respectively.

Miami’s spending spree didn’t work out as planned. There will be no postseason games for the Marlins, partly due to the fact that every one of their free-agent signings underperformed, relative to their contracts: Mark Buehrle -2.0, Jose Reyes -1.4, Greg Dobbs -1.2 and Heath Bell -0.4.

Splitting up the signings by those where players were re-signed and those who switched teams, we see something interesting. Contra Matt’s hypothesis (backed by analysis by MGL) that teams that re-signed players tended to see better value — relative to signings where players switch teams — 2012 saw players who switched teams produce an additional 12.2 WAR above expectations (96.9 versus 84.7). Players who re-signed produced almost exactly what they were expected to (18.1 WAR). This isn’t to say Matt is wrong (hint: he’s not), just that in this particular year the league did a pretty good job of getting value from players that switched the teams. The Diamondbacks re-signed six players — and thanks mostly to Aaron Hill’s 5.5 WAR — benefitted from an additional 4 WAR above what they expected.

All things considered, 2012 was a pretty good one for free-agent signings. Considering that there were some players who didn’t get a chance to step on the field this year — like reliever Ryan Madson — it’s reasonable to say that the numbers could have been even better.

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Data for this article is current as of Sept. 27, 2012. Free agent signings compiled mostly from ESPN.com.

*Darvish’s AAV does not include the posting fee. If it did, Darvish would still be outperforming his expected WAR (+.2), and the Rangers would drop to fourth overall in terms of average WAR above expected.