Evaluating the Success Rate of MLB Contracts over $100 Million

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Evaluating the Success Rate of MLB Contracts over $100 Million
USA Today

Last week saw a flurry of action on the MLB free-agent market, with the big move coming when the Seattle Mariners signed second baseman Robinson Cano to a massive 10-year, $240 million deal that ranks as the third-largest contract in MLB history.

That deal marked the 48th time a contract of $100 million or more has been handed out, with the first such deal going to right-hander Kevin Brown when the Los Angeles Dodgers signed him to a seven-year, $105 million deal prior to the 1999 season.

On the surface, it seems as though more often than not, teams wind up regretting handing out the mega deal. What is the actual success rate of contracts in excess of $100 million? Let's dive right into this one and find out.

 

Completed $100 Million-Plus Contracts

Stephen Dunn/Getty Images
Dodgers pitcher Kevin Brown.

Of the 48 contracts over $100 million, a total of 13 of them have been completed through the end of the 2013 season.

Those 13 were a mixed bag from a success standpoint, and here is a quick look at the contracts and the rWAR that each player put up over the duration of their deal.

Completed $100 Million-Plus Contracts
Name Contract rWAR Total (Average) WS Titles
Kevin Brown, LAD (99-05) 7/$105 M 22.9 (3.3) 0
Ken Griffey Jr, CIN (00-08) 9/$116 M 13.3 (1.3) 0
Alex Rodriguez, TEX (01-10) 10/$252 M 71.6 (7.2) 1
Derek Jeter, NYY (01-10) 10/$189 M 41.2 (4.1) 1
Manny Ramirez, BOS (01-08) 8/$160 M 36.6 (4.6) 2
Mike Hampton, COL (01-08) 8/$121 M 2.9 (0.4) 0
Jason Giambi, NYY (02-08) 7/$120 M 22.0 (3.1) 0
Todd Helton, COL (03-11) 9/$141 M 32.9 (3.7) 0
Albert Pujols, STL (04-10) 8/$116 M 65.8 (8.2) 2
Carlos Beltran, NYM (05-11) 7/$119 M 32.2 (4.6) 0
Barry Zito, SF (07-13) 7/$126 M 3.0 (0.4) 2
Carlos Lee, HOU (07-12) 6/$100 M 8.7 (1.5) 0
Johan Santana, NYM (08-13) 6/$137.5 M 15.2 (2.5) 0

Baseball Reference

 

The Good: 4

All parenthetical stats represent the player's average line during the duration of his contract, unless otherwise noted. 

Manny Ramirez (142 G, .315/.415/.595, 36 HR, 115 RBI) and Albert Pujols' contracts (154 G, .326/.424/.618, 41 HR, 118 RBI) were both clear home runs for both sides. The duo ranked among the premier run producers in the league throughout those contracts, and both led their team to a pair of World Series titles.

Gregory Shamus/Getty Images
Red Sox left fielder Manny Ramirez.

Alex Rodriguez (151 G, .299/.394/.577, 42 HR, 124 RBI) was worth every penny of his record-setting contract, winning three AL MVP awards. But he spent just three years with the Rangers before being dealt to the Yankees, and Texas posted losing records in each of his three years with the team. That said, the deal still falls in the "good" category given his production.

Yankees captain Derek Jeter (151 G, .310/.380/.445, 16 HR, 72 RBI) remained one of the best shortstops in the game throughout his deal and continued to be the face of the franchise. There was no way the Yankees would let him walk, and it was a good contract for them.

 

The So-So: 4

Todd Helton (137 G, .316/.423/.508, 18 HR, 76 RBI) was no longer the elite power threat he once was after the first two years of his contract. While he continued to hit for a plus average and was undoubtedly the face of the franchise, he was definitely overpaid.

Jonathan Daniel/Getty Images
Astros left fielder Carlos Lee.

Carlos Lee (149 G, .283/.337/.466, 23 HR, 97 RBI) posted three 100-RBI seasons to kick off his six-year contract with the Astros before falling off from there. He remained a plus run producer, but was no longer a legitimate threat to approach .300 BA, 30 HR, 100 RBI.

Jason Giambi (128 G, .260/.404/.521, 30 HR, 86 RBI) was held to 80 games in 2004 and 83 games in 2007. Still, he averaged 37 home runs the other five seasons and continued to get on base even when his average dipped. The deal was more good than bad.

Similarly, Carlos Beltran (126 games per year) averaged 29 home runs, 104 RBI and 21 steals per year over the first four years of his contract, but he played in just 145 games the next two years before being traded to the Giants midway through what was a solid final season of his contract.

 

The Bad: 5

Ken Griffey Jr. (110 games per year) had three very good seasons during his time with the Reds. Unfortunately, he played in fewer than 120 games five different times and appeared in just over 67 percent of games during the nine-year deal. He was a fan favorite, and with an AAV of just $12.9 million, the contract was far from an albatross. But it still fell well short of what the Reds hoped to get out of the deal.

 

Denis Poroy/Getty Images
Giants pitcher Barry Zito.

Mike Hampton (18 GS, 7-7, 4.81 ERA), Kevin Brown (23 GS, 10-6, 3.23) and Johan Santana (18 GS, 8-6, 3.18 ERA) all pitched well at times during their contracts, but they missed significant time due to injury. Hampton and Santana each missed two full seasons, while Brown topped the 25-start mark just three times in seven years.

Finally, there is Barry Zito, who only dealt with injuries in one of his seasons with the Giants, but he simply was not the same pitcher he was in Oakland. All told, he was 63-80 with a 4.62 ERA in 208 games (197 starts) during his seven years with the Giants.

 

Halfway Through $100 Million-Plus Contracts

Christian Petersen/Getty Images
Cubs left fielder Alfonso Soriano.

The following players have not yet completed their contracts, but with over half of the deal behind them, there is enough of a sample size to make an informed decision. 

Players Over Halfway Through $100 Million-Plus Contracts
Name Contract rWAR Total (Average) WS Titles
Alfonso Soriano, CHC (07-14) 8/$136 M 9.3 (1.3) 0
Alex Rodriguez, NYY (08-17) 10/$275 M 21.5 (3.4) 1
Miguel Cabrera, DET (08-15) 8/$152.3 M 36.4 (6.1) 0
Vernon Wells, TOR (08-14) 7/$126 M 6.9 (1.2) 0
CC Sabathia, NYY (09-16) 8/$186 M 22.1 (4.4) 1
Mark Teixeira, NYY (09-16) 8/$180 M 16.3 (3.3) 1
Matt Holliday, STL (10-16) 7/$120 M 16.6 (4.2) 1
Cliff Lee, PHI (11-15) 5/$120 M 20.4 (6.8) 0

Baseball Reference

 

The Good: 4

The Cardinals traded for free-agent-to-be Matt Holliday (.301/.386/.511, 25 HR, 94 RBI) at the deadline in 2009, then locked him up the following offseason. He's given the Cardinals exactly what they hoped for to this point.

Brace Hemmelgarn-USA TODAY Sport
Tigers first baseman/third baseman Miguel Cabrera.

Miguel Cabrera (.327/.407/.588, 38 HR, 123 RBI) was given an eight-year deal by the Tigers after being acquired in a trade with the Marlins prior to the 2008 season, and he's since been arguably the best player in baseball. Even at $22 million this coming year, he's a steal.

Pitchers Cliff Lee (31 GS, 12-8, 2.80 ERA) and CC Sabathia (32 GS, 18-8, 3.52 ERA) rank among the top left-handers in the game today, even after Sabathia struggled this past year.

The Yankees ace held an opt-out clause three years into what was originally a seven-year, $161 million deal. Instead, he simply signed an extension that tacked one year and $25 million onto the end of the deal once the three-year mark rolled around. This is assuming Sabathia returns to form this coming season.

 

The So-So: 2

Mark Teixeira played in all but 16 games during his first three seasons with the Yankees, hitting .266/.363/.514 and averaging 37 home runs and 114 RBI. Injuries limited him to 123 games in 2012, though, and just 15 this past year. If he can stay healthy, he should be able to return to his pre-injury form.

Elsa/Getty Images
Yankees first baseman Mark Teixeira.

Coming off a 46-HR and 41-stolen base season in 2006, hopes were high for Alfonso Soriano (135 G, .263/.317/.497, 28 HR, 82 RBI) when he signed an eight-year deal with the Cubs.

While he was never again able to match those numbers, he has hit at least 20 home runs in each season of the contract to this point and has posted back-to-back 30-HR, 100-RBI seasons. There's no question he failed to live up to expectations, but he has remained productive.

 

The Bad: 2

Coming off an MVP season in 2007, Alex Rodriguez signed his second 10-year deal for a record $275 million. He kicked off the deal with three straight 30-HR, 100-RBI seasons, but his numbers were down significantly in 2011 and 2012 before he missed all but 44 games in 2013 while battling injury.

Mike Stobe/Getty Images
Yankees third baseman Alex Rodriguez.

Now he looks to be headed for a lengthy suspension, and at this point he's a shell of his former self and one of the most polarizing players in all of baseball.

After a career year in 2006 in which he hit .303 with 32 home runs and 106 RBI, Vernon Wells scored a back-loaded extension from the Blue Jays in what was an ill-advised move from the start.

Somehow the Blue Jays found a taker with the Angels prior to the 2011 season, and they managed to move him again to the Yankees last offseason. But it's fair to say Wells has fallen well short of living up to his deal.

 

Less Than Halfway Through $100 Million-Plus Contracts

Dustin Bradford/Getty Images
Rockies shortstop Troy Tulowitzki.

The $100 million contract has become far more prevalent since the start of the 2011 season, and a number of players are still in the early stages of their nine-figure deals.

Here is a look at the players signed prior to this offseason that are less than halfway through their contracts.

Players Less Than Halfway Through $100 Million-Plus Contracts
Name Contract rWAR Total (Average) WS Titles
Joe Mauer, MIN (11-18) 8/$184 M 11.3 (3.8) 0
Troy Tulowitzki, COL (11-20) 10/$157.75 M 11.9 (4.0) 0
Carl Crawford, BOS (11-17) 7/$142 M 2.3 (0.8) 0
Jayson Werth, WSH (11-17) 7/$126 M 6.8 (2.3) 0
Albert Pujols, LAA (12-21) 10/$240 M 6.5 (3.3) 0
Prince Fielder, DET (12-20) 9/$214 M 6.5 (3.3) 0
Matt Kemp, LAD (12-19) 8/$160 M 2.9 (1.5) 0
Adrian Gonzalez, BOS (12-18) 7/$154 M 7.5 (3.8) 0
Matt Cain, SF (12-17) 6/$127.5 M 4.4 (2.2) 1
Ryan Howard, PHI (12-16) 5/$125 M -0.5 (-0.3) 0
Jose Reyes, MIA (12-17) 6/$106 M 5.5 (2.8) 0
Justin Verlander, DET (13-19) 7/$180 M 4.6 (4.6) 0
Felix Hernandez, SEA (13-19) 7/$175 M 5.2 (5.2) 0
Buster Posey, SF (13-21) 9/$167 M 5.2 (5.2) 0
Zack Greinke, LAD (13-18) 6/$147 M 3.9 (3.9) 0
Cole Hamels, PHI (13-18) 6/$144 M 4.6 (4.6) 0
David Wright, NYM (13-20) 8/$138 M 5.8 (5.8) 0
Josh Hamilton, LAA (13-17) 5/$125 M 1.5 (1.5) 0

Baseball Reference

Long-term contracts generally get worse as they progress, as most players are in the prime of their careers when they first ink their biggest contract. As such, their playing days are winding down by the time it comes to an end.

With that in mind, it's impossible to peg these deals as good or bad this early on, but here is my best guess as to how things inevitably play out.

 

Good?

Joe Mauer and Troy Tulowitzki are both three years into their deals and have both dealt with injuries, but they still rank as two of the better offensive threats in the league. With Mauer moving to first, he should be able to stay productive longer, and Tulo is still just 29 and remains the best all-around shortstop in the game when healthy.

Ezra Shaw/Getty Images
Mets third baseman David Wright.

Buster Posey and David Wright are both elite-level talents and the faces of their respective franchises. A move away from catcher seems likely for Posey at some point, but as it stands right now, both of these players look more than capable of making good on their contracts.

On the pitching side of things, locking up Justin Verlander and Felix Hernandez long term were musts for the Tigers and Mariners, respectively. Neither pitcher was as dominant as they had been in the past in 2013, but both are still durable, front-line arms who should continue to anchor their staff throughout their contracts.

 

So-So?

Two years into his 10-year contract, Albert Pujols has been a huge disappointment for the Angels, and his 2013 season ended with an injury. If he can stay healthy, he should be able to return to form, but given the length of the deal and his slow start, "so-so" seems to be where things are headed.

Patrick McDermott/Getty Images
Phillies pitcher Cole Hamels.

The trio of Zack Greinke, Matt Cain and Cole Hamels are all very good pitchers, but not quite part of the top tier of starters in the MLB. As such, all three were somewhat overpaid to begin with and could have trouble living up to their contracts.

Slugging first basemen Prince Fielder and Adrian Gonzalez remain among the most productive players in the league at their position, but the second half of their deals could be rough if they are not able to maintain their current level of power production. They are both somewhat one-dimensional.

 

Bad?

Jayson Werth, Carl Crawford and Jose Reyes were all vastly overpaid to begin with, in my opinion, and all three have dealt with injuries since signing their respective contracts. My guess is things go from so-so to bad by the time their contracts are over.

Jeff Gross/Getty Images
Angels right fielder Josh Hamilton.

Ryan Howard and Josh Hamilton both signed the same five-year, $125 million deal. With Howard struggling to stay on the field and Hamilton debuting in Los Angeles with a thud this past season, both of those deals have a good chance to be busts.

The biggest question mark here is Matt Kemp, as he still has the physical tools to be one of the best players in all of baseball. However, he's played just 179 games over the past two years after a durable start to his career. Staying healthy will be key, but Kemp looks to be headed for "bad" territory unless he can turn things around.

 

Upcoming $100 Million-Plus Contracts

Brian Bahr/Getty Images
Giants catcher Buster Posey.

This offseason's big free-agent signings, Robinson Cano and Jacoby Ellsbury, join six others with extensions set to kick in for 2014 or later as the upcoming $100 million class.

Upcoming $100 Million-Plus Contracts
Name Contract rWAR WS Title
Robinson Cano, NYY (14-23) 10/$240 M N/A -
Joey Votto, CIN (14-23) 10/$225 M N/A -
Jacoby Ellsbury, NYY (14-20) 7/$153 M N/A -
Dustin Pedroia, BOS (14-21) 8/$110 M N/A -
Ryan Zimmerman, WSH (14-19) 6/$100 M N/A -
Elvis Andrus, TEX (15-22) 8/$120 M N/A -
Ryan Braun, MIL (16-20) 5/$105 M N/A -
Evan Longoria, TB (17-22) 6/$100 M N/A -

Baseball Reference

Shin-Soo Choo could join that group once he finds a home this offseason, and Clayton Kershaw will likely eclipse $200 million once the Dodgers come to terms on an extension with their 25-year-old ace. It looks like a decent bet that those will be the next two guys to sign a $100 million deal, but they will be far from the last.

 

Conclusion

As the market for impact free agents continues to climb, there will be no shortage of players joining the $100 million club in the years to come.

Is it still worth taking a risk on signing someone to a $100 million-plus deal given the low success rate?

Submit Vote vote to see results

There is still a lot of baseball to be played on the majority of $100 million deals that have been signed, but looking at the 21 contracts that are either completed or nearing completion gives us a decent overview as to how often signing someone for $100 million-plus actually works out.

Of those 21 contracts, eight of them have turned out to be legitimately good deals for the teams involved, six resulted in so-so production at a premium price and seven have been nothing short of bad.

That's a whopping 38 percent of the time that signing someone to a $100 million-plus deal has worked out according to plan, or just over a third of the time. Granted it's a small sample size to draw from, but there is no doubt spending that kind of money is a huge risk and will remain one.

 

*All contract info courtesy of Baseball Prospectus unless otherwise noted.

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