Estimating the Value of Contract Extensions: Jacob deGrom

Photo: Jeff Roberson, AP

Opening day is only a few days away, and it was recently announced that Jacob deGrom and the Mets are progressing towards an extension, as conveyed by Michael Mayer of Metsmerized Online:

Mets and Jacob deGrom are “moving in the right direction” towards an extension before Opening Day on Thursday. They’ve had recent “positive” talks the source said.

This is exciting news for the Mets, whose chances of resigning deGrom prior to the start of the regular season were seemingly nonexistent earlier this week. We will now take a closer look at contracts signed by other ace-caliber SPs in order to determine the cost teams pay per 1 fWAR…

Patrick Corbin

Age (he will be for majority of 2019 season): 29

Team: Washington Nationals

Contract (per Spoctrac): 6yr/$140 million

Projected fWAR for duration of contract: 11.7 ([3.2] +[3.2 – 0.5] + [2.7 – 0.5] + [2.2 – 0.5] + [1.7 – 0.5] + [1.2 – 0.5] = 11.7)

  • Weighted fWAR: 3.2
    • 2015 (fWAR): 1.7
    • 2016: 0.7
    • 2017: 3.0
    • 2018: 5.9

$ (millions) / 1 fWAR: 11.966

Clayton Kershaw

Age: 31

Team: Los Angeles Dodgers

Contract (per Spoctrac): 3yr/$93 million

Projected fWAR for duration of contract: 12.6 ([5.2 – 0.5] + [4.7 – 0.5] + [4.2 – 0.5] = 12.6)

  • Weighted fWAR: 5.2
    • 2015 (fWAR): 8.7
    • 2016: 6.4
    • 2017: 4.3
    • 2018: 3.3

$ (millions) / 1 fWAR: 7.381

Justin Verlander

Age: 36

Team: Houston Astros

Contract (per Spoctrac): 2yr/$66 million

Projected fWAR for duration of contract: 7.7 ([5.1 – 1.0] + [4.1 – 0.5] = 7.7)

  • Weighted fWAR: 5.1
    • 2015 (fWAR): 3.1
    • 2016: 5.3
    • 2017: 4.3
    • 2018: 6.7

$ (millions) / 1 fWAR: 8.571

Chris Sale

Age: 30

Team: Boston Red Sox

Contract (per MLB Trade Rumors): 5yr/$145 million

Projected fWAR for duration of contract: 18.2 ([6.3 – 1.0] + [5.3 – 0.5] + [4.8 – 0.5] + [4.3 – 0.5] = 18.2)

  • Weighted fWAR: 6.3
    • 2015 (fWAR): 5.6
    • 2016: 5.4
    • 2017: 7.5
    • 2018: 6.2

$ (millions) / 1 fWAR: 7.967

Here are the adjusted fWAR for the 2020 season (applying a standard ann. 5% inflation rate)…

  1. Clayton Kershaw: $8.134 million
  2. Chris Sale: $8.365 million
  3. Justin Verlander: $9 million
  4. Patrick Corbin: $13.192 million

The median fWAR for the 2020 season (for ace-caliber SPs) would be ~$8.683 million / 1 fWAR

For the purpose of this investigation, let’s assume that the deGrom’s new contract goes into effect starting in the year 2020.

Jacob deGrom

Age: 31

Team: New York Mets

  • Weighted fWAR: 5.5
    • 2015 (fWAR): 4.8
    • 2016: 2.9
    • 2017: 4.1
    • 2018: 9.0

Next year is deGrom’s 4th and final year of arbitration eligibility. In order to project what the Mets would presumably be paying him (if he were to settle through arbitration), we will take a closer at the pitcher who tentatively holds the record for the highest 4th-time arbitration eligible contract — David Price

3rd time: $14 million

4th time: $19.75 million

Percent increase: 41.071%

If we apply the same percent increase to deGrom’s 3rd time arbitration salary ($17 million), deGrom’s 4th time salary would likely land in the ballpark of $24 million.

deGrom’s projected fWAR by year and estimated salary per season

2020: 4.5; $24 million

2021: 4.0; $36.5 million (4.0 fWAR * [$8.683 million / 1 fWAR * 1.05])

2022: 3.5; $33.5 million (3.5 fWAR * [$8.683 million / 1 fWAR * 1.05 * 1.05])

2023: 3.0; $30 million (3.0 fWAR * [$8.683 million / 1 fWAR * 1.05 * 1.05 * 1.05])

2024: 2.5; $25 million (2.5 fWAR * [$8.683 million / 1 fWAR * 1.05 * 1.05 * 1.05])

2025: 2.0; $20 million (2.0 fWAR * [$8.683 million / 1 fWAR * 1.05 * 1.05 * 1.05])

2026: 1.5; $15 million (1.5 fWAR * [$8.683 million / 1 fWAR * 1.05 * 1.05 * 1.05])

2027: 1.0; $10 million (1.0 fWAR * [$8.683 million / 1 fWAR * 1.05 * 1.05 * 1.05])

2028: 0.5; $5 million (0.5 fWAR * [$8.683 million / 1 fWAR * 1.05 * 1.05 * 1.05])

Contract Possibilities:

  • 1 yr, $24 million
  • 2 yr, $60.5 million
  • 3 yr, $94 million
  • 4 yr, $124 million
  • 5 yr, $149 million
  • 6 yr, $169 million
  • 7 yr, $184 million
  • 8 yr, $194 million
  • 9 yr, $199 million

Prediction: 5 yr, $150 million

What contract do you think deGrom will sign? Comment below!

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