Tuesday, February 28, 2012

Ryan Zimmerman's signs $100M extension

Earlier this month, I ranked some of the highest paid players in baseball based on how much they'd be worth to their teams, relative to their contracts. With that in mind, I thought I'd take a look at how Ryan Zimmerman's extension measures up. The contract will keep him in Washington through the 2019 season, and includes a $18M team option for 2020, or a $2M buyout if that option is not exercised. In total, Zimmerman is owed $116M over the next eight years. A lot of money, yes, but is Zimmerman worth it?

My analysis says yes. Sure, Zimmerman's 2011 season, where he played only 101 games, is a concern. However, I can't think anyone would have more information on his health than the Nationals do. And since the Nats seem to have moved, in a general sense, toward knowing what they're doing, I'm going to give them the benefit of the doubt. In both 2009 and 2010, Zimmerman was a 5+ WAR player. That's easily worth what the Nationals are paying him.

I have Zimmerman estimated at about 31.1 WAR over the next 8 years, a number that would be worth about $156M, $40M more than he's actually scheduled to earn. That would rate him the fourth best of the megacontracts, behind only Braun, Tulowitzki and Kemp. Over the course of his contracted term with the Nationals, they're getting a great value.

Of course, Zimmerman was already under contract for the first two years, so I suppose the better question is whether he'll be worth the $100M from 2014 to 2019. My system has him worth 9 WAR over the next two years, and about 22.1 over the next six (covered by his extension). So obviously a big chunk of his value is coming now. However, think about eight years ago. Back in 2004, $20M a year was a massive contract, and $14M was considered extensive. Miguel Tejada's contract with the Orioles was 6 years, for $72M, an average annual value of only $12M - this, for a player regarded (correctly) as elite. While Zimmerman might not be worth quite the $18M he's due in 2019, at age 34, it's possible that he will. What's more likely is that he's worth so much more than the $14M he's due in most of the years before that nobody will care. Running his numbers, I estimate Zimmerman to be worth $113.3M over the six years covered by his extension - meaning the Nationals are taking a sensible gamble.

I suppose this means it's time to adjust our expectations of what a ONEHUNDREDMILLION player is. Certainly, this story got more press than it would have if Zimmerman's extension had been for merely $95M. The fact is, a non-elite-but-still-very-good player can be worth $15M-$18M a year now. With each win being worth something between four and five million, that's the new math. Be careful though - if signing non-elite players inhibits your chances to add an elite one, you've made a mistake. Bryce Harper is likely under team control until 2017, at which point the Nationals will have only two years and $34M committed to Zimmerman. A significant amount, but nothing that should smother them.

All in all, Zimmerman's contract rates as a smart risk for the Nationals.

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