Is Giancarlo Stanton worth his contract?

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Photo Credit: Scott Cunningham (Getty Images)

Giancarlo Stanton is baseball’s best power hitter. That statement doesn’t ring as particularly bold right now, however many questioned if peak Stanton had come and gone after an injury-riddled 2016 season where he posted a career low OPS of .815 and wRC+ of 114. But Giancarlo, now healthy and in peak prime at 27 years old, is having arguably the best season of his career in 2017. His 44 home runs leads the majors by seven over second place Aaron Judge, while his .645 slugging percentage is 21 points higher than runner-up Cody Bellinger. His home run total is already a career-best, while his slugging percentage, isolated slugging percentage and OPS are all career highs as well.

Yet, despite 2017 serving as the apogee of Stanton’s on-field performance, it seems like the Miami Marlins might be ready to part ways with their franchise player. Trade rumors have swirled around Stanton all season and have recently intensified with the impending sale of the team to a conglomerate headed by Derek Jeter. Stanton was even placed on revocable waivers and cleared earlier this week, allowing him to be dealt after the July 31st deadline. Does new ownership want to keep the face of the franchise and one of the best power hitters in baseball? Or do they want to rid themselves of a $310 million contract liability and start fresh?

stanton historical value

Giancarlo Stanton’s career to date, despite injury issues, has been a smashing success for the Miami Marlins. By the end of this season Stanton will have earned $38.4 million in his playing career, but provided $234 million in value based on his on-field performance (side note: to determine Stanton’s value, we’re simply multiplying his wins above replacement – WAR – by the cost of what one WAR was in that given season). That’s $196 million in surplus value that Stanton provided to the Marlins, excluding any consideration for his ability to draw fans into the seats and sell jerseys on South Beach.

But the key to Stanton’s potential trade value is how much value he’ll provide relative to his contract going forward. Unfortunately for the Marlins, the prognosis doesn’t look good.

The contract

stanton contract.PNGAssessing the value of a baseball player is a complex process. On-field ability, age and contract status are all equally relevant variables in the equation. Stanton is currently three years into a 13-year, $325 million contract that contains a club option for a 14th year at $25 million. The first three years of Stanton’s deal featured marginal salaries of $6.6 million, $9.0 million and $14.5 million this season, but the cost quickly ramps up starting in 2018 to $25 million. By 2023, when Stanton is 33 years old, he’ll earn $32 million per season. Beginning in 2018, Stanton will be set to earn a whopping $310 million through the 2028 season. Note that Stanton has the right to opt out of this deal after the 2020 season, while the 2028 season is a club option that features a $10 million buyout if they don’t wish to retain him.

As FunGraphs explored in early June, these type of contracts rarely tend to work out well for the teams involved. Generally speaking, teams tend to pay players in the future based on past performance. Stanton’s contract fits this concept to a tee, as his highest earning years are from 2023 to 2025, when he’s entering his mid-30s. Given that very few people have Adrian Beltre’s inverted aging curve, I think it’s reasonable to expect Stanton to be an inferior player at that juncture, and for some team to be writing checks to Stanton for more than he’s worth at the time.

So the central questions are 1) can Stanton produce enough surplus value in the beginning of his contract to justify the end and 2) how sharply will his production drop as he ages?

The first key: Health

Given Stanton’s injury prone past, his health going forward will be a major determining factor in his future worth. Thus far Stanton has played in 76% of potential games in his career, which averages to 123 per season. Stanton has battled all variety of injuries in his eight-year career, including a hamstring strain, quadriceps strain, groin strain, sore shoulder, facial fracture and hand fracture. Some of these injuries, like a fractured cheek bone from getting hit in the face with a pitch, are freak of nature. But the consistent presence of lower body strains probably indicates that Stanton is injury prone.

stanton gp projectionAnd would it really be that surprising? Stanton is 6’6″, 245lbs, and patrols left field night in and night out. Someone with that size and muscle mass is likely more apt to get injured than someone with a slimmer, more wiry frame. The concern going forward is that if Stanton has only been able to average 123 games through 27, how many games will he end up missing as his body begins to decline?

I crafted a largely arbitrary projection of Stanton’s future games played, starting at 140 in 2018 and 2019 and declining to 115 in 2028 in his age-38 season. Obviously his actual games played over the next 11 years won’t follow such a linear pattern, but it’s probably fair to assume he’ll tend to miss more games with age. The projection totals 129 games per season on average, or 79% of games played, which is actually higher than his aged 20 to 27 seasons! This is based on the fact that some of Stanton’s freak injuries are unlikely to reoccur.

How much and how fast will he decline?

war-barPlayers tend to put up a majority of their career WAR in their age 27 through 29 seasons, with a swift drop occurring once the early 30s hit. Stanton has totaled 10.2 WAR in 310 games played since 2015, which extrapolates to 4.9 per 150 games. His poor 2016 season drags this number down a bit while his fantastic 2015 and 2017 seasons pull it up. All in all I think using 5.0 WAR per 150 games is a fair place to start for Stanton’s “peak” ability in his age-28 season in 2018.

stanton WAR project.PNGFrom there we need to discount Stanton’s peak WAR/150 for aging effects. I assumed fairly consistent production from 2018 to 2021, but as you can see in the accompanying chart, 32 is an age where players really start to regress. The downswing only gets worse year after year. Of course, not every player ages this way. But I think it’s reasonable to expect a large, injury prone player who strikes out a lot to perform at the standard aging curve for MLB players. In total, I expect Stanton to be worth 29.5 WAR for the rest of his contract. His average WAR/150 for the contract duration is 3.3.

Putting it all together

With Stanton’s WAR projections in hand, as well as assumptions for how much one WAR will cost moving forward, we can building a schedule of Stanton’s expected value. The cost of one WAR in 2018 is pegged to $8.2 million, which is slightly above where it is in 2017, and grown by a 2.0% inflation factor each season.

stanton value

Under these assumptions, Stanton will be worth $263 million for the remainder of his contract. He will continue to produce surplus value through 2021, but after that point he will begin costing his team. All told, Stanton’s value relative to his contract would be negative $47.2 million. Theoretically whatever team has Stanton at that point would buy out the last year of his contract for $10 million rather than pay $25 million for $7.2 million worth of production, so perhaps the negative value goes down from $47.2 million to roughly $40 million in that scenario.

Based purely on on-field performance, it seems like any team looking to acquire Stanton will want Miami to hold back substantial salary in order to make the deal works. And if Miami wants a significant prospect in return, they’ll likely need to hold even more salary back.

A word of caution

In case you couldn’t tell, there were a lot of semi-arbitrary assumptions in this analysis. In particular, Stanton’s average games played will have a very large impact on his value going forward. If he manages to play in more than 79% of games, then he could be worth his contract. Of course, advanced age could also could show 79% to be an optimistic assumption.

The other variable that has a significant impact on Stanton’s value is the cost of a win. Since Stanton’s contract is fixed, his contract will become less onerous as player salaries in the MLB grow. The underlying assumption of 2.0% annual growth in cost per win, which can basically be thought of as growth in player salaries, might be higher, in which case Stanton’s contract will look better.

stanton senstivity.PNG

The issue is that Stanton will need to average close to 150 games played and player salaries will need to grow at 3.0% annually for his contract to come close to breaking even. While the latter might happen, I see no way that the former does.

The other variable is of course Stanton’s actual on-field performance, measured by WAR. The assumptions had Stanton averaging a WAR/150 of 3.3 for his age 28 through 38 seasons. That’s an extremely aggressive assumption. Not only will Stanton’s hit tool need to stay close to where it is now, his defense must also stay at a passable level.

For some perspective, only four players 35 or older had 3.0+ WAR in 2016. The amount of 37-year old players with a WAR over 2.5 last season was two: David Ortiz and Adrian Beltre. The amount of 37-year old players who even had over 250 plate appearances? Eight.

All in all, Stanton’s contract seems like a loser based on purely baseball performance. A player of his magnitude does bring star power that will fill seats, sell jerseys and bring in advertising revenue, but that was outside of the purview of this analysis.

 

One comment

  1. Charlie Gerli · · Reply

    The Marlins should move him out, The age injury scenario is not attractive. The new management doesn’t want to be saddled with this contract going out a few years. Good writing by you.

    Like

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