What the Blue Jays Should Be Willing to Pay for Starting Pitching Help

(Title photo courtesy of slgckgc,  https://www.flickr.com/photos/slgc/14138684259)

The Blue Jays need for starting pitching has been well-documented. For years now, the team has struggled to put together a full rotation of quality starting pitchers. This season, they are 25th in baseball in terms of xFIP- with a mark of 111 (ERA- of 112). Last year, 22nd and the year before, 23rd. It’s been an issue and for the past two years, General Manager Alex Anthopoulos has consistently stated publicly that he knows this and is working to address it.

Sometimes, the deals just don’t fit properly and you’re left empty-handed. This happened with the rotation in the offseason and the Blue Jays were smart to not panic about pitching and instead redirect their resources to improving other parts of the team. But now it’s the most upgradable part of the team, there are numerous pending free agents who may become available in the coming weeks, and the Blue Jays are in reach of the division-leading Yankees as well as the wild card conversation.

What should the Blue Jays pay for a rotation upgrade? I wanted to use asset value arithmetic to figure out what an appropriate price would be for each pitcher. If this derived appropriate price is greater than the team is asking for, maybe there’s a match. These calculations will include a realistic market $/WAR figure that is adjusted for the Blue Jays situation, projected performance for the Blue Jays players and a valuation for prospects.

How Assets Will Be Evaluated (Assumptions Made)

– I am going to assume that the market at large is willing to pay $7MM to acquire a marginal win (as represented by Fangraphs’ Wins Above Replacement metric). Entering the 2013-14 offseason, it was suggested by Lewie Pollis after a lengthy analysis that the market cost was $7MM. Different studies employ different considerations and $7MM seems fair. It doesn’t matter if that number is slightly off because all players will be compared to it. However, since we’re at the trade deadline of a season in which nearly every team is in contention, marginal wins are worth more since they are more likely to make a difference come late September. Every win is huge for a team like the Blue Jays. So, I believe it’s appropriate to bump the 2015 rest-of-season $/WAR figure to $10MM. This is consistent with win curve theory.

– The market rate for $/WAR will increase at a rate of 5% per season, across the board. Starting pitcher projected wins will decrease at a rate of half a win per season. These players are generally at the peak of their career or following so this assumption that they will decline is generally accurate. Injuries are included to some degree in the projection already. 28 starts will be used for future seasons.

– 40% of a pitcher’s 2015 total salary is used for rest-of-season salary.

– Fangraphs Depth Charts projection figures will be used to project major leaguers. These projections are an aggregation of the Steamer and ZiPS systems.

– If the Blue Jays added a single starter, he would improve upon replacement level. Felix Doubront, Aaron Sanchez and Co. are probably slightly-above replacement options, but there are replacement-level innings in the bullpen that they could in turn displace.

– Prospect values will be determined using the conclusions that Point of Pittsburgh writers Kevin Creagh and Steve DiMiceli came up with in the offseason. They used Baseball America Top 100 lists from 1994-2005 and ensuing production during the team control years to assess surplus value produced by segments of top prospects. The discount associated with future production is included. Surplus values for this article will be adjusted slightly up to account for the $7MM/win value we’re assuming, as well as smoothed out slightly (they found that 51-75 ranked pitching prospects have been worth less than 76-100 ones) and extrapolated for 101+ ranked prospects. Here are the values used:

Prospect surplus values at $7MM per marginal win.

Prospect surplus values at $7MM per marginal win.

Surplus value is a term that refers to the value derived from an asset after adding the raw production it creates and subtracting by the cost paid. If a player is paid $50MM of salary to generate $75MM of production as defined by the WAR framework, then his team has collected $25MM of surplus value from him. This technique is central to contract evaluation in baseball and is intuitive. A prospect’s expected surplus value is essentially his market value.

Blue Jays Prospects

The prospect values we’re going with require prospects to be categorized into buckets that assess them as between the 1st and 10th best prospects, 11-25, 26-50, 51-75 and 76-100. Here is how I would categorize each of the Blue Jays prospects.

Daniel Norris: 11-25 range of pitchers (worth $30MM). Norris recently ranked 9th on the Baseball Prospectus midseason top 50 and 18th on the Baseball America list. These lists did not include 2015 draftees or prospects who are in the majors but have not exhausted prospect eligibility. Norris struggled while starting the season in the big league rotation but has looked okay in Buffalo and appears to be nearing another call-up.

Dalton Pompey: 26-50 range ($25MM). Pompey ranks 25th by Baseball Prospectus and 29th by Baseball America, putting him squared in this range after accounting for recent draftees and major leaguers with eligibility.

Jeff Hoffman: 26-50 range ($20MM). Hoffman ranks 18th by Baseball Prospectus and 33rd by Baseball America. He was recently promoted to double-A and is on track to make the major leagues by early 2016.

Aaron Sanchez: 51-75 range ($12MM). Sanchez has ranked very highly in the past on all lists but has struggled this year in the major leagues (he hasn’t allowed many runs but his process has been poor. He projects around replacement level as a starter) and probably should be in the major league bullpen or harnessing his stuff in Buffalo. I like most of the prospects on the current BP and BA lists more than Sanchez and rankings were mixed on him pre-season. Kiley McDaniel of Fangraphs ranked him 70th while Baseball America and Baseball Prospectus said mid-20s. The 51-75 range seems right.

Anthony Alford: 76-100 range ($12MM). Alford is one of the most accomplished amateur athletes in Mississippi history. The former Mr. Baseball and Mr. Football has finally committed full-time to baseball and the results have been very encouraging so far. Alford has crushed both low-A and high-A this year as a 20-year-old and is learning how to use his immense toolset. He was not a top 100 prospect pre-season but might be in the back portion currently and Keith Law recently placed him inside his mid-season top 50.

Max Pentecost: 101-150 range ($6MM). Pentecost hasn’t done much since being drafted high in the first round last year, as he’s dealt with various injuries. His brief debut in Lansing last season wasn’t great but it’s a small sample and he’s a true defensive catcher. Kiley McDaniel ranked him at 93rd coming into the season while other sites did not rank him. Placing him in the 101-150 tier makes sense.

Sean Reid-Foley: 101-150 range ($5MM). Reid-Foley was drafted in the second round last year after profiling as a first round talent. He’s been both electric and wild in his pro career so far; the sum of the parts is encouraging and he has made two good high-A starts. He’s definitely a prospect on the rise and with some development could be in the top 100 conversation come next spring. A good talent that the Blue Jays won’t want to give up on but who could make sense in trade as he’s not as close to the majors as their other prospects.

Matt Boyd: 101-150 range ($5MM). Boyd has a huge variance in public opinion. Some, like Keith Law, think he’s a pretty fringy prospect, while others see his stats and okay stuff and see him as a legitimate major league starter. I think his major league readiness puts him at the $5MM range. The Steamer projection system believes Boyd is a decent major league starter right now. I’d like to see him get another chance in Toronto soon, instead of being moved since his potential value could get a huge spike should he establish himself.

Miguel Castro: 101-150 range ($5MM). Castro has had a very strange last few months and it’s weird to think of his value to other teams since many would likely send him back to high-A and bring him through the minors as a pure starting pitching prospect. The Blue Jays are still committed to him as a major league reliever. Kiley McDaniel had him in the 142-200 range of prospects entering the season while Baseball America ranked him 9th among Blue Jays prospects. He probably fits in around the back half of the current 101-150 prospects.

Richard Urena: 151-200 range ($2MM). Urena was a trendy pre-season sleeper as a shortstop who had some offensive tools. He ranked 8th pre-season by Baseball American and has had an up-and-down year. Urena didn’t place on any major list but I think he has value and could figure into the bottom portion of a current top 200 list. Some teams would surely be comfortable with this projected $2MM surplus value.

Prospects who aren’t regarded as top 200 guys are not worth a whole lot and because there is no quality resource that ranks more than 200 prospects, it’s hard to differentiate between them with any accuracy. These players will not likely become quality major leaguers but they do have value. As we saw with the trade that sent Chase DeJong and Tim Locastro to the Dodgers, some teams place million-dollar price tags on prospects who are outside of the top 200 range. The value would differ wildly among teams; the Dodgers or Yankees can afford to spent much more freely than lesser revenue teams and would happily scoop up dozens of lesser-regarded prospects for hundreds of thousands of dollars each since it’s so difficult to acquire amateur talent these days (the draft and international markets have much more restrictive rules than they did even five years ago). The Dodgers have done their own prospect valuation math and are willing to pay more than $7MM per expected marginal win to acquire prospects like Chase DeJong.

I am going to go ahead and assign a $800k price tag to the following prospects:

Mitch Nay, Jairo Labourt, Dwight Smith Jr., Clinton Hollon, Conner Greene, Rowdy Tellez

The following prospects will carry a $500k price tag:

Matt Smoral, Jesus Tinoco, Alberto Tirado, Dan Jansen, Angel Perdomo, Taylor Cole

In total, the Blue Jays have over a hundred million dollars in value here. That is a considerable amount that will attract any other team’s attention. The Blue Jays could realistically trade for any player in baseball that is made available at the deadline. However, it’s worth noting that other teams won’t likely trade top major leaguers for a package of six C-level prospects even if the expected value works out. They’ll instead ask for an A-level or two B-level prospects with a lottery ticket guy tacked on. Here is a quick summary of the prospect values being used.

surplus value

Potentially Available Pitchers

Now, to look at the worth of starting pitchers who may be available. This includes rental and controllable pitchers.

Cole Hamels

Hamels is one of the very best pitchers who may be available and he has additional team control that is attractive to buyers. The Phillies need to trade him, and have been trying to do so since at least last offseason, when they were rumoured to have asked the Red Sox for top young players such as Mookie Betts and Blake Swihart. Here is his value map:

Hamels

Cole Hamels. Money figures are in millions of dollars (USD)

The future season surpluses are probably being under-valued here from a Blue Jays perspective since they have trouble attracting premier free agents. Cole Hamels’ contract would be a very good deal for Toronto since they wouldn’t be able to land a similar one in free agency. For a team like the Red Sox or Yankees, his contract has less value since they have no trouble getting players to take their money. Hamels’ surplus value looks considerately better if you bump up the $/WAR figures. However, his utility to the average team is probably being overrated in general. He’s a very, very good pitcher who has a history of durability, but he isn’t quite an ace, more of a great #2 starter.

James Shields

shields

James Shields. Money figures are in millions of dollars (USD)

Shields actually appears to present surplus value to the average team! I’m a fan of his production profile: maximally durable with consistently above-average production. Shields is a #2 starter who has experienced an interesting jump in strikeouts this season. I wanted the Blue Jays to explore signing him in the offseason, but their financial realities and his preferences (Shields is from southern California) seemed to prevent that from happening. As mentioned with Hamels, the Blue Jays collect some extra value from acquiring market-rate free agent deals.

Shields would be an ideal pitcher to add to the Blue Jays mix this year and in 2016-and-beyond. He doesn’t have that much value on top of his salary though and the Padres would view moving him as primarily a salary dump. Still, he is not dissimilar to Hamels as a pitcher and asset, yet the public seems to view them very differently.

The Rentals

There are so many impending free agents that I decided to put them all into one value map with the remainder of 2015’s stats.

rentals

Money figures are in millions of dollars (USD)

This is a lot of pitchers! Many of them will not be moved, but most of them should be since their teams are out of contention. Cueto is obviously the prize. He doesn’t make much money and is really really good. Price is slightly better but more expensive and much less likely to be available. Pitchers like Hisashi Iwakuma, Scott Kazmir and Mat Latos represent intriguing second-tier options, although they have much less value because we’re only looking at two months of production. If the Blue Jays decide not to move any top prospects, they could perhaps still land a Doug Fister or Dan Haren type.

What The Blue Jays Should Do

The exact dollar numbers matching up perfectly isn’t that important because the assumptions we’ve made should all be afforded some wiggle room. The Blue Jays are probably willing to pay in excess of the assumed $/WAR numbers because they haven’t made the playoffs in so long, have an older offensive core that may not be as effective in the future, etc. Going the other way, Felix Doubront, Matt Boyd and Daniel Norris may be better-than-replacement options for the Blue Jays in the second half, cutting into the advantage of acquiring a pitcher.

The Blue Jays financial situation will also influence things. It’s not known how much money they have to play with in terms of 2015 commitments, but from public comments they seem to have enough to swallow the salary for most pitchers being considered. If they acquired a closer like Chapman or Papelbon in the trade, they may need to take some cash in return as well.

Trading Daniel Norris for any of these pitchers alone doesn’t really make sense. His struggles in the majors may make it seem like he’s on a downward trajectory and has lost his premium luster, but Daniel Norris is still a really talented pitcher and very valuable asset. However, he would make sense for Cueto if the Reds also included Aroldis Chapman (who is controllable through 2016). Here are some moves for the team that I could actually see being possible and that fit roughly into the defined framework:

– Daniel Norris, Miguel Castro and Dwight Smith Jr. for Johnny Cueto, Aroldis Chapman and $2MM

– Daniel Norris, Max Pentecost and Richard Urena for Cole Hamels, Jonathan Papelbon and $10MM

– Aaron Sanchez, Miguel Castro and Jesus Tinoco for James Shields, Brandon Maurer and $5MM

– Dalton Pompey, Aaron Sanchez and Matt Smoral for James Shields, Craig Kimbrel and $10MM

– Jeff Hoffman and Alberto Tirado for Johnny Cueto

– Jeff Hoffman, Sean Reid-Foley and Dwight Smith Jr. for Johnny Cueto, Mike Leake and $1MM

– Sean Reid-Foley and Taylor Cole for Hisashi Iwakuma

– Max Pentecost and Miguel Castro for Jeff Samardzija

– Sean Reid-Foley and Dwight Smith Jr. for Scott Kazmir

– Miguel Castro and Mitch Nay for Mat Latos

– Richard Urena and Jesus Tinoco for Yovani Gallardo

– Richard Urena and Jairo Labourt for Dan Haren and Steve Cishek and $1MM

These potential deals don’t provide much information on top of the values I’ve already defined, but they make it easier to envision what a package would look like. I would be comfortable with most of these offers and I don’t think they are too far off what the teams involved are considering.

If you think some values are off or wish to propose a trade of your own, please leave a comment below. This trade season should be very interesting to watch since so many teams are still in it. Decisions to sell could be made very late in the process and there’s a lot of baseball to be played until August hits.

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Author: Spencer Estey

Spencer has been a baseball fan since a young age and, being from Toronto, he has always been partial to the Blue Jays. He is a statistics major at the University of Waterloo and is intensely interested in the analytic aspect of the game. Spencer follows baseball by watching countless games each season, reading various advanced analysis sites, playing in deep dynasty fantasy leagues and discussing the game with fellow fans.

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3 Comments

  1. Interesting article and well-thought out. my only nitpicks are 1) Based on the Moncada contract, are you undervaluing prospects? And how does that deal change if all players have free agent status. 2) Based on KLaw’s top 50 prospects list released this week, are you potentially ranking Alford (who KLaw ranked 39th in MLB) too low? Obviously, the second one is a major nitpick.

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    • Thanks for the comments, Gary.

      I’m using an expected surplus value framework to evaluate prospects. We don’t need to limit ourselves to using a model based on what teams have been willing to pay prospects on the open market, since we have hard data on what prospects have been worth in the past. Past data gives us a good indication of what each tier of prospect is worth. What the Red Sox gave Moncada doesn’t disagree with the framework. He is an elite hitting prospect who would be assigned the $55MM value, only around $5MM less than the Red Sox paid.

      Other sites didn’t rank Alford at mid-season. I’m excited about his progress but I don’t get the feeling that he’s better than a consensus top 76-100 prospect at the moment. Baseball America released a mid-season top 10 Blue Jays list today and had Alford below Richard Urena and Miguel Castro. I could definitely see him continue to climb prospect boards, though. The tools are there and he’s starting to use them effectively.

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  2. Should also mention that neither Pompey or Hoff made KLaw’s list, and that KLaw (admittedly) is notious about favouring guys who are closer to MLB-ready.

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