Wednesday, July 13, 2011

Jamie Garcia: Contract Analysis

The St. Louis Cardinals signed pitcher Jamie Garcia to a 4-year $27.5 million contract.

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Garcia has been excellent in his first two seasons in the bigs.  He's a combined 23-12 with a 3.06 ERA in 57 games (48 starts) covering 296 and 2/3 innings.  But those stats aren't nearly enough to tell the story.

In 2010 Garcia struck out 7.3 batters per 9 innings; 3% better than the league average of 7.1 per 9.  He walked 3.5 batters per 9 innings; 6% worse than the league average of 3.3 per 9.

So for in 2011 Garcia has struck out 7.7 batters per 9 innings; 10% better than the league average of 7 per 9.  He has walked 2.5 per 9 innings; 19% better than the league average of 3.1 per 9.

While his strike outs and walks are around the league average his real strength is in his ability to generate ground balls.  In 2010 he got ground balls 25% more often than the league average (55% to 44%) and in 2011 he his getting ground balls 23% more often than the league average (54% to 44%).

Ground balls, of course, have the advantage of being extremely difficult to hit for home runs.  Garcia gives up .6 home runs per 9 innings; only 2/3rds as often as the league average.

This adds up to a very good pitcher.

Garcia's 2010 FIP was 3.41; 12% better than the league average.  In 2011 he's been even better.  His 2.98 FIP is 19% better than the league.

Garcia's tERA, which is becoming my favorite stat for pitchers because of its use of batted ball trajectory, was 3.63 in 2010 and has dropped to 3.06 in 2011.

So, what's he worth?

In 2010 he was paid $400,000.  In 2011 he'll be paid $437,000.  According to FanGraphs he provided $12.6 million in 2010 and $11.5 million thus far in 2011.  Obviously, he was worth a bit more than he was getting paid, but we aren't worried about the past, we want to know how this contract looks going forward.

Garica is on pace for about 4 WAR this season.  As a young pitcher who is likely to be improving we'll begin by assuming that he will pick up 4.5 WAR in 2012 and become a 5 WAR pitcher after that.  Also assuming the cost of a win at $5 million with 5% salary inflation we get the following chart.

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I'm not sure of the actual details of Garcia's contract other than it has 4 years guaranteed at $27.5 million.  There are also two additional team option years-which I've chosen to ignore for now (though I would guess that they are in the $15 to $20 million range).  It's important to remember that 2012-2014 are Garcia's arbitration eligible years.  As such, I have discounted the WAR$ column by 60% in 2012, 40% in 2013 and 20% in 2014.

Our assumptions have Garcia producing 19.5 WAR worth almost $80 million over the guaranteed part of the contract with the Cardinals only paying him $27.5 million-great deal for the Cardinals, right?  Well, yes.  But remember they are now assuming all of the risk.  If Garcia is injured tomorrow and never throws another pitch or comes down with Steve Blass-itis they are on the hook for all $27 million.

This deal is pretty similar to two contacts the Red Sox agreed to with two of their young pitchers, Jon Lester and Clay Buchholz. I looked at those contracts here.

All of the above deals look like good deals for the teams and guaranteeing your first $30 million isn't bad  for the player either.

Other Contracts Reviewed:
Ryan Braun
Adrian Gonzalez (& Mark Teixeira and Ryan Howard)

Stats from: Baseball-Reference and FanGraphs

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