Let’s Look at Josh Hamilton and Three Years
So the big rumor is that Seattle and others are trying to get Josh Hamilton to sign for three years. And the big reaction has been, “If anyone signs him for that, it should be my team!” That presents a couple of issues. First, even if Hamilton signs for three years, only one team is going to get him, and everyone else is going to be mad at their team. Second, what would constitute a good three-year deal?
The point of a three-year deal is that you’re getting the best years, and if the player bombs, you don’t overpay by that much—not as much as if it was five-year deal anyway. So, let’s start with what Hamilton’s worth. Stealing from MCOA’s work in the Three Outfielders thread and assuming about $6M per win, here’s what you get:
Year 1, 4.7 WAR, $28.2M
Year 2, 4.2 WAR, $25.2M
Year 3, 3.7 WAR, $22.2M
Year 4, 3.2 WAR, $19.2M
Year 5, 2.7 WAR, $16.2M
So for three years, you’re looking at a value of $76M or so. If you can get him for that, great! But it seems like with so many teams interested, you’re more likely to pay about 3/$85M. So you overpay by $9M, but you’re not on the hook for a long, bad contract. But a contract at 5/111
would not (in theory) be an overpay at all and would seem a lot more attractive to Hamilton. Why not go that route? Sure, you take on a bit more risk but you a) actually get the player and b) you get him for two more years at a comparative bargain.
Even if you think Hamilton’s likely to age worse than expected, say at 3/4 of a WAR per year, the five-year deal is still appealing. Three-year value would be $71M so you’re overpaying by $10M on a 3/$81M deal. Offer him 5/$100M you’re still only overpaying by $4M and you still have a more attractive offer.
Overall, it looks to me like the team that really wants Hamilton should bite the bullet and offer him a deal of 5/$100M to 5/$110M. Of course, the team that REALLY wants him should offer him a out-clause after 1 year. That team will likely get the best year of the rest of his career and will not have to pay him long-term.
Posted: December 07, 2012 at 10:31 PM | 20 comment(s)
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