Posted November 21, 2013

What is he really worth?: Robinson Cano

Free agency, New York Yankees, Robinson Cano, What's he really worth?
Robinson Cano, Yankees

Robinson Cano is reportedly seeking the richest contract in baseball history. (Jim McIsaac/Getty Images)

Over the next few days, SI.com will provide an analysis of some of the top free agents to explore just how much they are really worth on the open market. Next up: Robinson Cano, the consensus top free agent on the market.

Robinson Cano wants $310 million, but then again, who doesn’t? That shocking figure, which would exceed the largest contract in baseball history by $35 million, is still the free agent second baseman’s asking price, even after Fox Sports’ Ken Rosenthal reported earlier this month that Cano’s demand to break the $300 million threshold represented an in-season buyout of the opportunity cost of forgoing free agency. The Yankees aren’t inclined to meet that price on a deal of 10 years, or any other length for that matter, particularly while they pray that a PED suspension takes a big bite out of Alex Rodriguez’s 10-year, $275 million cautionary tale.

What’s Cano actually worth, though? On Wednesday I kicked off a series that attempts to grapple with the astronomical price tags attached to this winter’s top free agents, using a simple model that incorporates the following elements: a player’s past performance, a projection of his future performance, the market cost of a marginal win, inflation and aging. Rather than pin a single value to a player, I showed how the changes in our assumptions with regard to any of those parameters can affect that estimate, thus producing a range that may or may not be in line with the rumors that are floating around.

I used Jacoby Ellsbury to illustrate the concepts, and concluded that a deal in the general range of the existing seven-year deals for Jayson Werth ($126 million) and Carl Crawford ($142 million) isn’t out of line, even given the 29-year-old centerfielder’s volatile career to date. Unless you’re a tycoon of industry, you may blanch at that range of dollar figures produced by such an exercise, but even as impact players on the open market become more scarce, you can bet that teams will still whip out their checkbooks to spend some of that increased television revenue that is flooding the game.

Now I turn my attention to Cano, a 31-year-old five-time All-Star who towers above the rest of this year’s free agent class. Using Baseball-Reference.com’s version of Wins Above Replacement, no other position player in this year’s market has produced even half the value of his 16.1 WAR over the past two seasons. The closest is Shin-Soo Choo at 7.6, and the closest of any major leaguer is 39-year-old pitcher Hiroki Kuroda at 9.6. Indeed, among all position players, only Mike Trout (20.1 WAR) has outdone Cano over that timespan. Expand the timeframe to three years, and only Miguel Cabrera (22.1) has surpassed Cano (21.5), but go to four years and the tables are turned, with Robbie having a 29.7 to 28.6 edge over Miggy. In other words, we’re talking about a player whose consistency — 7.6 WAR or more in three of the past four seasons — gives him a legitimate claim as one of the top three position players in the game.

In estimating Cano’s baseline value projection for 2014 using a weighted sample of his recent seasons, it doesn’t matter a whole lot whether I use three years at 5/4/3 or four years at 5/4/3/2. (That former would take his 2013 WAR and multiply it by five then add four times his 2012 WAR and three times his 2011 WAR and then divide by 12, which is the sum of 5+4+3; the latter would also include two times his 2010 WAR and divide by 14.) The result for the first formula is 7.4, the second 7.5.

Cano is heading into his age-31 season with a stratospheric WAR and thus has further to fall than most, so I’m going to start with the assumption that he will decline at a rate of 0.5 wins per year. I’ll stick with Russell Carleton‘s estimate of $5.276 million per win for hitters in their seventh year of service time and beyond, as well as a five percent rate of inflation.

Year  Age  WAR  Market $/W Prod $
2013 30 7.6 5.28 40.1
2014 31 7.4 5.54 40.7
2015 32 6.9 5.82 39.8
2016 33 6.4 6.11 38.8
2017 34 5.9 6.41 37.5
2018 35 5.4 6.73 36.0
2019 36 4.9 7.07 34.3
2020 37 4.4 7.42 32.3
2021 38 3.9 7.80 30.0
2022 39 3.4 8.18 27.4
2023 40 2.9 8.59 24.5

Whoa, right? That last column is an estimate of the free-market value of Cano’s annual production in dollars, and even with a significant decline over a 10-year period, this model suggests he can produce well above $30 million in annual value for most of the life of that deal — enough to justify the highest average annual salary in history, topping A-Rod’s $27.5 million. Via this method, I get 51.0 WAR over the 10-year period, valued at an astronomical $341.4 million.

That seems ridiculously high, higher even than Cano’s agents — hip-hop mogul Jay-Z and Brodie Van Wagenen — are reportedly asking. As long as I’ve brought them up, let’s note that I’m not incorporating any non-baseball factors into this. I don’t care about the marketing plan that Roc Nation Sports may be hatching in order to turn the second baseman into a transcendent icon; first, because it’s overheated rhetoric and second, because it’s the player and not the team who stand to reap the bulk of that benefit.

So forgetting that and still shaking our heads at that $341.4 million figure, let’s get a bit more drastic with Cano’s falloff. We’ll peg his 2014 season at 7.0 wins and knock 0.6 wins off every year. Given those parameters, he still produces 43.0 WAR and a value of $282.9 million. Increase his rate of decline by 0.7 WAR per year from that 7.0 starting point, and even with his last two seasons coming in at 1.4 and 0.7 WAR, respectively, he would still produce 38.5 WAR overall and $248.7 million of value over 10 years. That’s without touching our estimates for inflation or the value of a win. Using that last scenario and moving the rate of inflation one percentage point in either direction produces values of $238.7 million on the low side and $259.1 million on the high side, a small enough difference that it doesn’t really move the needle much in either direction.

If a difference of $10 million higher or lower raises an eyebrow, let’s remember that the gaps produced by my varying estimates aren’t the point. For a big-market team that generally intends to position itself as a contender, the marginal value of a win is going to be higher than the industry average. If a player who costs them $250 million returns only $220 million in value, that’s a small premium compared to a $50 million player producing only $20 million in value.

Back to the model. Sticking with a five percent rate of inflation and returning to a more normal decline of 0.5 WAR per year but lowering his 2014 baseline by a full win to 6.4 brings back values of 41.5 WAR and $275.2 million over 10 years. Lowering his 2014 baseline to 5.4 — thus matching his worst year in the past four, 2011 — still produces estimates of 31.5 WAR and $205.5 million over the next decade. In other words, even if we discount Cano’s near-future work quite heavily, this model still returns values above $200 million over the next 10 years.

Suppose instead that we return to a more generous estimate of Cano’s near-term work and his decline but introduce a more drastic hit in his value by moving him to DH for the final three years of his contract. Using the positional adjustments built into bWAR, the value of a full season at second base is +3 runs, while that at DH is −15, so we’ll lop off an additional 18 runs (1.8 WAR) going into 2021. Starting at 7.4 WAR and a decline of 0.5 WAR per year, that produces a value of 4.4 WAR in 2020, but a drop to 2.1 in 2021 (4.4 minus 0.5 minus 1.8), and then 1.6 and 1.1 in the final two years. All told, that still produces estimates of 46.1 WAR and $300.6 million worth of value. Start the ball rolling at 6.4 WAR instead of 7.4, move the DH switch to a year earlier and it still brings back values of 34.3 WAR and $217.6 million. Again, even with a significant discount of his near-term work and a move to DH, he’s still well above $200 million over the next decade.

The problem for Cano is that the Yankees and probably every other team have plenty of reasons to be gun-shy about handing out 10-year deals even to elite players. Putting aside the possibility of a suspension without pay, Rodriguez’s $275 million deal doesn’t look as though it’s going to end well because years five and six produced a combined 2.6 WAR due to injuries. On the other hand, it’s worth noting that over the course of the decade that would have been covered by his original $252 million deal (2001-2010), he produced a whopping 71.6 WAR, more than enough to justify the cost.

As for some others: Albert Pujols’ 10-year, $240 million deal saw him drop from an average of 7.5 WAR over the previous three years to 5.0 in year one and 1.5 in year two. Prince Fielder dipped to 1.7 WAR in year two of his nine-year, $214 million contract and he was just traded to Texas. Joe Mauer is headed to first base after three years of his eight-year, $184 million deal. Mark Teixeira has produced just 6.8 WAR over the past three years due to injuries and decline and still has three to go on his $180 million deal, while Matt Kemp has delivered just 2.9 WAR in the first two years of his eight-year, $160 million deal due to injuries.

All of which raises the question of how much we can rely upon a model that builds in a gradual decline over a very long period instead of a drastic, career-threatening injury — but then, who can predict that? Maybe if I were building a model for pitchers, I’d assume each one would lose a year to Tommy John surgery given a long enough window. Pitcher or hitter, the longer the deal, the more likely it is that some such catastrophe comes about, which is why teams would rather sign contracts covering five or seven years instead of longer ones, even at a premium.

But just to illustrate my larger point, suppose we start again at 6.4 WAR and a 0.5 per yer decline. Then assume that Cano turns in a goose egg in 2018 due to injury, a value of 0.0 WAR (down from 4.9 the year before) and only partially rebounds to 3.0 WAR in 2019 before resuming his decline. Even then, he would be worth 32.6 WAR and $210.4 million.

In the end, I don’t think Cano will get 10 years from anyone, particularly with the Red Sox (Dustin Pedroia), Dodgers (too many big contracts), Tigers (Ian Kinsler), Rangers (Jurickson Profar) and Phillies (Chase Utley) all set at the position. The Angels are hampered by the deals of Pujols and Josh Hamilton, while the Giants are deep into investments in Buster Posey and Hunter Pence. That list covers eight of the top nine teams in terms of 2013 payroll, with the Blue Jays the only one I haven’t included. Maybe they’ll be Cano’s mystery team.

Eight years may be a more realistic target, and even as I twiddle with the parameters above, most reasonable estimates come back with Cano producing well over $200 million worth of value in that time. Start with 6.4 WAR and a decline of 0.5 per year, and the estimated return is $239.2 million worth of value over eight years. Bump him to DH over the final two years and incur that extra 1.8-win penalty and he still comes back at $211.8 million.

Agents and players tend to want to emerge from negotiations with some claim on superiority. If Cano can’t get the largest contract in baseball history in terms of overall value, he can at least exceed the average annual value of A-Rod (or Roger Clemens, if one uses the $28 million prorated salary for his shortened 2007 comeback). Eight years at $30 million a year is $240 million, which would allow Cano’s camp to stake that claim while matching Pujols for the longest non-A-Rod deal on record; throw another couple of million on that pile and he eclipses Pujols. I think he winds up in that ballpark, probably with the Yankees despite their concerns over the luxury tax threshold. As sky-high as it may seem, I think he’ll deliver enough value that it won’t seem like a ridiculous overpayment.

77 comments
haephaestus
haephaestus

Ha. The way Cano hustles to first, playing on turf for the Blue Jays, he'll be thrown out on grounders even before he gets out of the box.

EduarCabrera
EduarCabrera

Jay Jaffe you must be on crack! put it down .

MichaelC
MichaelC

This is stupid. Throw out the numbers and stats. The most important reason why it's not sensible to give ANY player 10 year contracts is ... they rarely, if ever, pan out. You're essentially paying for past performance and incurring all the risk. The funny thing is that EVERYONE knows this.

What do we know as fact? After age 30, the body breaks down, is more prone to injury (and take longer to recover), and even if healthy, everything slows down (speed, bat speed, range, etc.). That's the standard career trajectory. And as much as his agents want to make him a "brand", name a baseball player other than Jeter who's become insanely marketable personality. With Cano you have a great player with limited English and limited clubhouse presence (he's never had to be the "guy").

Look at some "great" 2B over the years. Chase Utley was a WAR king from 2005 to 2009 (7.2, 7.3, 7.8, 9.0, 8.2) but over the past three years, has been hampered by injuries and mediocrity (combined WAR of 10.2). Roberto Alomar's last productive year was at age 33 - he WAR'd -0.3 over his final three years and was out of the game by age 36.

Cano deserves to get paid but pump the brakes. Don't over-bid against yourself. Why should he be the highest paid player in MLB? What's wrong with 5 years $125M or 6 years $150M?

ZiggyBarone
ZiggyBarone

I have 1 word for this article: WRONG!

SteelyDon
SteelyDon

So with this logic, an 80 win season at 6 million per victory would mean a team would have a payroll of 480 million.


Worst article ever.

EduarCabrera
EduarCabrera

whom ever wrote this article and is saying that Robinson Cano is worth 310 millions must be getting paid by J-Z

Joe118
Joe118

Assuming 5% inflation seems insane... A. Players don't get paid for inflation.. B. The average inflation the last 5 years is only 2%, the last 10 years under 2.5%.  Not to mention the decline will be much sharper after 35.

AlamBrito
AlamBrito

ROBINSON CANO COULD SIGN A 10 YEAR $350 MILLION WITH THE TEXAS RANGERS NEXT DECEMBER 2013...

Steaklover
Steaklover

Why would anyone want a player that plays the game only half the time. He dogs it out on infield hits and i've seen him in games when he seems not all that interested in playing the field. $300 million, I think not. 

William27
William27

and miggy is worth $50 million a year

William27
William27

this is the most absurd horse manure I have ever heard

ineedataxi
ineedataxi

WAR = blah bluh blah blib blub blah bah bah bah

Michael10
Michael10

Your WAR projections for Cano are unrealistic because they don't account for the sharp decline that middle infielders (as well as catchers and centerfielders) experience around age 32 and especially after age 35. Your model projects Cano at 19.4 after 35 when the reality is only 12 players have ever produced that kind of value beyond that age -- almost all inner circle HOFers like Ruth, Cobb, Williams, Wagner, Mays, Aaron, Musial, Speaker -- and only deadballer Eddie Collins did so while playing second base.

Through age 30, Cano has produced 45.1 WAR, just ahead of Chuck Knoblauch and Ryne Sandberg and behind Roberto Alomar and Bobby Grich. After age 33, Knoblauch was out of baseball, Alomar was a negative producer, Sandberg came out of retirement to produce a single 3 WAR season, and Grich led the pack with a total of 10.9 WAR. None made another All-Star appearance.

Cano's closest comp according to Baseball-Reference is Nomar Garciaparra -- and we know how that story ended as well. A hopeful yet realistic estimate is that Cano winds up in HOF range with 70 WAR with most of that additional 25 WAR being produced by age 37. At $6-7MM per win, $150-175MM over seven years is within reason -- which means some weak-minded owner desperate to make some noise in his market will give Cano $210-225 over 8-9 years.

fansguru
fansguru

This is a joke right! We can create spreadsheet with convenient formulas and prove any one is worth any amount of money!  Simple fact is there has been no blockbuster contract that has ever worked for any time, whether it is Pujols or ARod especially when player is into their 30s

ronle
ronle

To quote from the movie WarGames (1983): "The only winning move is not to play. How about a nice game of chess."

UnishowponyWherebeef
UnishowponyWherebeef

Jaffe is an idiot. And I mean this in a nice way because his being an idiot shields him from all of the other less pleasant adjectives that would describe the person who wrote this article.

A MLB baseball player "deserves" at most $150,000 per year. 

That's over three times the average US salary. Imagine getting paid three times what you're making now in order to play a kid's game! Awesome!

Idiots, such as Jaffe, encouraging sports figures to demand these outrageous salaries is what has caused the average ticket price to increase exponentially during the past 25 years. 

Baseball is no longer a family sport. It is available only to the wealthy. Sad and pathetic.

utoo
utoo

Anyone that says paying someone at 40 for what he did at 30 is acceptable is not someone I would take serious or take the time to read his article extensively.

foolme1nce
foolme1nce

I'd argue that Jeter has been the most valuable Yankee in the last 30 years. If you were to take his best 10 year span and adjust for inflation he wouldn't come anywhere near $300 million in salary. That should be the baseline.

OK
OK

Six years, $144 million

PAZSKY
PAZSKY

Another Jaffe joke article....

BBBigster
BBBigster

You got it all wrong Jaffe, you have to question.  Is WAR that Cano brings worth $ 300 million, when you can get different pieces to replace Cano...  cheaply.  

onlyreasonablesportsfan
onlyreasonablesportsfan

Jay, even if the WAR numbers are correct how does investment in player as a percentage of payroll calculate into your thinking. Assuming a team has a $150 million payroll. Is doling $30 million or 20% of the payroll to a player contributing over 7 WAR worth the sacrifices that you make in the other parts of your roster? That is an analysis I would be curious to see.

RandyWiesner
RandyWiesner

I am a math major, and a baseball coach.  The WAR calculations are ok to look at, but some people take it too far.  The game is about stats yes, but unless you know what stats are the most important you have no clue what to do.  Hence they came up with the WAR stat.  I can explain it very simply.  Teams are not building their teams right at all.  The philosophy in hitting, pitching, and baserunning are off.  It has to be because they are not understanding the numbers at all.  Its sad, baseball is the greatest game ever, but it is not being played the right way.   One day I know that a gm or manager will think of what I believe and they will be dominate and everyone will copy them, and then baseball will be great again.  Until then just watch all the guys striking our and waiting for 5 run homeruns all the time.

EarlMalmsteen
EarlMalmsteen

I have no problem using WAR and think the "presence" quality is overrated.

The problem with this analysis is that it would have suggested all the same incredibly bad contracts that have been offered to over the last 10-15 years. The fact is almost none of those deals work out is because WAR doesn't just drop at 0.5/yr consistently. All it takes is a bad back arising at 32 or a knee at 33 and now you're spending 30M/yr on nothing.

I want to see this exact same analysis applied to all 100M+ deals to see not if it predicts what was paid, but rather if it predicts the value actually received by the teams.

DanaBunner
DanaBunner

The only sane contract offer is to not offer more than 5 to 6 years.  Yes, teams have been doing this.  But how many times has this worked out for players who hit free agency after 30?   Offer him $150M over 5 years.  Or $170M over 6 years.  Even this assumes a near best case scenario for the team.   Even $180M over 6 years is much better for the team than $240M over 10, as they will likely get significantly less production, if anything, over those last 4 years.

Boston_Mass_Sports21stCentury
Boston_Mass_Sports21stCentury

Any team stupid enough to pay this amount of money for a player over 30 deserves to have over 10 years in a row of seasons without a Championship.

Boston_Mass_Sports21stCentury
Boston_Mass_Sports21stCentury

Apparently mostly people by the name Jay as in Jay Z And Jay Jaffe editor of this article think Cano is worth more than $300 Million

MidwestGolfFan
MidwestGolfFan

WAR, WAR, WAR.  Blah, blah, blah.

Cano is a good player, but no stat can measure "presence."  Some guys whose stats aren't the greatest -- Kirk Gibson in his playing days comes to mind -- are big-time ballplayers.

Tell you what, Jay.  Why don't the ballplayers just play 20 games just to give you some numbers to work with, then you and Cliffy Corcoran and all your other WAR-buddies can simulate the rest of the season with "advanced metrics."

BeeperNPS
BeeperNPS

Jaffe is smoking some strong stuff that may be too much for me. Has he WATCHED Cano? Has he looked at specific stats and not WAR? No offense but WAR doesnt pass the eye test. The guy cant carry a team, and has mediocre at best plate discipline. Hes no Jeter or even "cough" Arod at the plate. His best year BY far was 2011. Hes been in decline since. Cant hit lefties, and is horrible with folks in scoring position. He's not fit to be Pedroia's batboy.  It would be crazy to give him even 7/175 but that would digestible. He really should only get 5/125 with a 6th year option. He doesnt deserve David Wright's contract. The Yankees should offer him 7/175 ish maybe 7/185(10 year guaranteed option) if he dont take it, get Infante.

DaveT1000
DaveT1000

@MichaelC You make good points.  Jaffe's decline curve for Cano isn't steep enough.

I think there's also a more fundamental problem in not looking at a separate analysis of downside risk.  Apply some probability that in any given year a guy might suffer an injury, miss 2/3 of a season, and hasten his aging curve by a couple years.  So say that in 2015 Cano ends up as a 1.5 WAR player - because he misses most of the season - and then fluctuates between a 2 to 4 WAR player in the years after that. 

That's the real downside of these long-term, $25 million per year contracts - that a team ends up locked into years of overpaying due to a sudden drop-off in performance from age or injury.  It's one thing for a team to take that risk on a contract for something like 5 years / $75 million, but a huge monetary bet on the health of 1 guy is a risk that's not covered in a simple decline curve.   The Angels are certainly finding that out with the Pujols and Hamilton contracts.



DaveT1000
DaveT1000

@SteelyDon You're missing the point.  A replacement level team would win something like 50 games per year, not 0.  It's also understood that purchasing a team at the going rates for free agents gets expensive very quickly.  There's the free agent market for WAR, but there are also young cost-controlled players in their pre-arbitration and arbitration years who can be expected to be a bargain versus free agents.

Guest55
Guest55

@Joe118 Baseball inflation, not "real-world" inflation. The money in baseball is rising astronomically due to the TV deals and all the new revenue streams. Teams have a lot of money to spend and the 5 million/WAR model of the past is more like 6 or 7 million/WAR.

Players DO get paid more when the money available to the owners increases.

CamThomas
CamThomas

@ineedataxi things I don't understand because I'm too lazy to do any research = blah bluh blah blib blub blah bah bah bah

lannychiu
lannychiu

@Michael10

I agree.  If he puts up something like 45 WAR through the rest of his career, pushing 90 for his career.  He starts to enter the really rarified air of players.  That would make him the 5th best second baseman of all time and nipping on the heels of Joe Morgan at 100.4.

If he ends up being that good, then sure the contract demand is reasonable.  But implicit in the model is a very strong assumption about performance.

Curt G
Curt G

@ronle Nice reference. I use that line often when I need to make a decision.

Michael10
Michael10

@UnishowponyWherebeef Like any other profession, a baseball player "deserves" to earn what the market dictates.  If you can find me a burger flipper that will draw 40,000 fans a night, I'll pay him accordingly...

tommydawg
tommydawg

@UnishowponyWherebeef The price of tickets to a MLB game have nothing to do with the salaries of the players playing the game, just like the cost of tickets to a broadway show have nothing to do with the salaries paid to the actors in the show. They all are based on the willingness of the public to pay. The Yankees average over 40,000 paid per home game and have the second highest average price per game next to Boston (Fenway's capacity is less than 40,000). If they did not continue to pay high prices, the prices would be lower. The salaries have gone up exponentially in the last few decades due to the exponential increases in the national and local rights fees and even more so with team owned or controlled cable networks.

grantdude
grantdude

@UnishowponyWherebeef How much an employer pays its employee is between the employer and the employee. You being jealous doesn't mean anything.

Curt G
Curt G

@RandyWiesner I would like to know your philosophy and how it differs from Billy Beane.

CamThomas
CamThomas

@DaveT1000 @MichaelC your argument here is logically invalid. Just because something has happened in the past does not mean that it will continue to happen in the future. This is especially true when you take into account the fact that these are not all exactly the same things. In fact they're people and are quite different from one another. With that said you're going to pissed because somebody (probably the yankees) is going to pay him well over 200m and it's probably going to be over 8+ years. 

Joe118
Joe118

@Guest55 @Joe118 Just because this has happened recently doesn't mean it can be continued indefinitely or that players get payed based on future possible inflation in their.  Players don't sign contracts with inflation in mind.

I very much doubt that a 8 WAR player will get paid like 60 million a year in 2023... and if he signed a 1 year deal he wouldn't get 40 million either.  Player maximums haven't changed much from ARods first monster deal with Texas that was over 10 years ago.

Michael10
Michael10

@tommydawg @UnishowponyWherebeef Sports ticket prices -- like every other form of entertainment -- are dictated by the cost of production, of which 25-50% is generally the cost of retaining talent. It's no different than paying Madonna a million dollars per concert or Will Smith twenty million a film...

UnishowponyWherebeef
UnishowponyWherebeef

@grantdude 

Actually, how much a baseball player is paid is between the Major League Baseball Players Association and the owner of the team.

You don't seem to realize that the only reason that sports players earn so much is because of the players unions. 

That's right! Unions!

So all of you right wing conservatives arguing that the players "deserve" to make $300M should contemplate a world in which employees "flipping burgers" are protected by unions that help guarantee a living wage.

Imagine a world in which all Americans actually had a decent living standard.

MidwestGolfFan
MidwestGolfFan

@Curt G @MidwestGolfFan  

Concur.  

In my opinion, if Morris wore pinstripes or pitched home games in Fenway, he'd have been in the HOF long ago.  To disagree in the ugliest way imaginable, here come the WAR-fans in 3...2...1...

CamThomas
CamThomas

@MidwestGolfFan @Curt G if he pitched in either of those parks his ERA would be way higher than it already is and he wouldn't even be close