Andrew McCutchen vs. Justin Upton: A contract analysis

Andrew McCutchen - Trev Stair, Flickr.com
Andrew McCutchen - Trev Stair, Flickr.com
The topic of signing Andrew McCutchen to a long-term deal has become a hot one since the Diamondbacks inked their own young star Justin Upton. I looked at what it might take to sign McCutchen a while back, so I wanted to compare the fictitious extension that I created to the real-life one signed by Upton.

Two things to consider here. Upton is a year younger than McCutchen, but he already has accumulated over two years of service time, compared to McCutchen’s half a season. Thus, Upton would have been eligible for arbitration after this season and free agency after 2013. McCutchen will not be arbitration-eligible until after the 2012 season, and the Bucs would control his rights through 2015. Both of these facts naturally make Upton more costly.

Also, in my original article, I think I undersold McCutchen’s talent a bit. I estimated that he would be worth about four wins per season, which is about the pace he played at in 2009. Seeing as he was only 22, he most likely has better days ahead. So for this article, I will assume that he will average 4.5 wins per season. Upton was worth 4.6 wins at age 21 last year, so I estimated his worth at an average of 5 wins per season.

In the tables below, each player’s WAR (for future seasons) represents my approximate guess at his value. Their future WAR numbers average out to the numbers I specified above. The Earned Salary represents the amount that each player would expect to receive if he did not sign an extension, and simply went year-to-year through arbitration and free agency. I used an average of $4 million per win, and determined the arbitration salary using the 40%/60%/80% method. Actual salary for Upton represents the amount he will receive after signing his extension. Actual salary for McCutchen is the amount that he would receive under a fictitious six-year, $30 million deal (plus two club options for $17 million each) that I created. This is similar to the deal that I came up with in my original article, plus the slight bump in player value that I discussed in the previous paragraph. Committed salary for both players is the potential amount paid for 2010 – 2015.

 

Andrew McCutchen
Year WAR Earned Salary Actual Salary
2009 3.6 0.4
2010 4 0.4 1
2011 4 0.4 2
2012 4.6 0.4 3
2013 4.7 7.52 6
2014 5 12 8
2015 4.9 15.68 10
2016 4.5 18 17 *
2017 4.3 17.2 17 *
Comitted Salary 36.4 30
* Team Option

 

Justin Upton
Year WAR Earned Salary Actual Salary
2007 -0.6 0.4
2008 0.7 0.4 0.393
2009 4.6 0.4 0.412
2010 4.5 0.4 1.75
2011 4.6 7.36 4.25
2012 5.1 12.24 6.75
2013 5.1 16.32 9.75
2014 5.2 20.8 14.25
2015 5.5 22 14.5
Comitted Salary 79.12 51.25

 

The Pirates would commit much less to McCutchen than Arizona committed to Upton. This is because McCutchen has three more years before even reaching arbitration. When Actual Salary is compared to Earned Salary, the Upton deal is a better bargain for the team. In exchange, the Pirates would receive the two option years for McCutchen, paying him at full market value. In this scenario, McCutchen potentially would not reach free agency until he was 30, while Upton would get a crack at a big payday at age 27. That is a disadvantage for McCutchen, but he should age well with his athletic skill set, meaning he should still be a hot commodity at that relatively later age.

Here is each player’s projected WAR through 2015 in graphical form. As you can see, I projected them to have pretty similar career paths, with Upton being slightly more valuable. There is nothing scientific in these numbers, just a subjective estimation on my part.

 

 

Here is a comparison of their salary over that same period. You can clearly see the extra value in Upton’s contract, as McCutchen would actually be overpaid in the early years before he is eligible for arbitration.

 

 

Because my proposed contract leans a little heavier to McCutchen’s side, it seems reasonable that the Pirates should be able to add the two option years on the end to delay his free agency years. Those two years are added in this graph.

 

 

Looking at this graphically, it actually appears that this is a bit of a raw deal for the Pirates. Because they are overpaying in early years, they are essentially paying market value for McCutchen over the course of the contract. In this sort of situation, the team should receive a decent discount, because it is committing guaranteed salary. Maybe this is what the front office is thinking right now. If the team waits until McCutchen is closer to arbitration, they should still be able to sign him to a similar contract, without overpaying for his pre-arb years.

As Dejan mentioned earlier today, it is rare that a young player signs a long-term extension with so little service time. Tim looks at Evan Longoria and Ryan Braun as two of the few players in this situation. I would love to see the Pirates lock up McCutchen as soon as possible, but it might just be more prudent for them to wait for another year or so. In the meantime, it is encouraging to see this kind of quote from McCutchen.

McCutchen smiled Sunday when asked if he thought about an extension when hearing of Upton’s.

“Not really,” he replied. “In order to get that, you need to do what you need to do here on the field. Justin’s played two full seasons, and he’s coming off a great season. He was offered that contract based off what he did. That’s something you think about after that. Of course, hey, it would be cool to have something like that. At the same time, it’s about focusing on helping the team win this season.”

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