Over the next few days, SI.com will provide an analysis of some of the top free agents to explore just how much they are really worth on the open market. Next up: Mike Napoli, fresh off a big year in which he helped the Red Sox win a world championship.
Mike Napoli wasn't supposed to be a free agent this winter. Last December, he agreed to a three-year, $39 million contract with the Red Sox, but when he took his physical to finalize the deal, team doctors discovered that he had avascular necrosis in both hips, a degenerative condition that kills bone tissue but can be treated with medication. After more than a month of back-and-forth negotiation, in mid-January he finally signed a one-year, $5 million contract that included additional incentives for days on the roster and/or plate appearances. Fortunately for his cause and that of the Red Sox, he didn't spend any time on the disabled list, thus earning a full bonus of $8 million to match the average annual value of his initial deal.
In all, Napoli hit .259/.360/.482 with 23 homers in a career high 578 plate appearances. He also made an impressive transition from splitting time at catcher, first base and DH to playing first every day -- so much so that he led AL first basemen in Defensive Run Saved (+10) and those in both leagues in Ultimate Zone Rating (+8.7). His 4.1 Wins Above Replacement (Baseball-Reference.com version) ranks as the second-best season of his eight-year major league career. It's safe to say that the 32-year-old slugger is hitting the market at a good time.
What kind of deal can he expect, and what kind of value can he provide? This series is my attempt to grapple with the astronomical price tags attached to this winter's top free agents. It uses a simple model that incorporates a player's past performance, a projection of his future performance, the market cost of a marginal win, inflation and aging, and it builds on top research done in those areas. Rather than pin a single value to a player, I've shown how the changes in our assumptions with regards to any of those parameters can affect that estimate, thus producing a range of dollar values that may or may not be in line with the rumors that are floating around.
So far, I've tackled the top three hitters in The Reiter 50 -- the ranking of the offseason's top 50 free agents as compiled by SI.com's Ben Reiter -- namely Robinson Cano, Jacoby Ellsbury and Shin-Soo Choo. I couldn't get to Brian McCann (fourth on the list) before he signed with the Yankees, but suffice it to say, I'm not bullish on high-mileage catchers over 30, particularly those with a recent history of injuries. The next ranked hitter is Napoli at number six.
Due to his position switch, figuring out what Napoli's baseline projection should be is a bit of a challenge. Typically, I'd use a 5/4/3 or 5/4/3/2 weighing of his past three or four seasons, but his 2010-12 workload was limited by the demands of part-time catching, which no longer applies because he's not a catcher anymore. Thus, I'd be inclined to prorate his offensive contributions for those seasons at least somewhat. On the other hand, I'd also apply a significant downward adjustment for his defense, as I did in the case of Joe Mauer. The positional adjustments built into B-R's version of WAR show that a defensively average catcher is worth an additional 10 runs to his team per year over a full season — the equivalent of an additional win beyond his offensive contribution — while a defensively average first baseman costs his team 10 runs over that same span. Based on the data we have, Napoli was a mediocre defensive catcher (-6 DRS per a 1,200 inning "year") and is an above-average first baseman (+5 DRS per "year"), so his drop in value may be considerably less.
In the end, I did a whole lot of boring spreadsheet-based math that didn't move the needle very much; my rough projection for 3.5 WAR for 2014 is 0.1 wins lower — one run less — than his weighted three-year average. So we'll start there, accompanied by a five percent rate of inflation and a cost per win of $5.276 million. Instead of my typical starting point of a 0.4 wins per year decline due to age, I'm going to bump that up to 0.5 to account for Napoli being a couple of years older than the other players I've examined so far, and more likely to wind up DHing at least part of the time. I'm also going to stick to a four-year projection since there hasn't been any noise about a deal as long as the ones Ellsbury or Choo may be seeking. Given all of that, here's what 2013 and his next four years might look like:
|Year||Age||WAR||Market $/W||Prod $|
That last column is an estimate of the free-market value of Napoli's annual production in dollars, simply his WAR multiplied by the estimated cost per win. For the four-year period, that's a total of 11.0 WAR valued at $64.9 million. If I'm more generous with his decline, limiting the decay to 0.4 WAR per year, the values rise to 11.6 WAR and $68.7 million, while if I move the same distance in the other direction, to 0.6 WAR lost per year, the numbers drop to 10.4 WAR and $61.2 million. Relative to the previous entries in this series, the shorter timespan in question leads to considerably less divergence when it comes to assumptions regarding how he'll age.
Previously, I've made the case that the dollars per win figure is likely higher for a contender whose playoff chances increase exponentially with each additional win, since reaching the playoffs allows them to tap into an additional revenue stream. Solid research on the topic has provided estimates in the $6-7 million range. If I instead use $6 million per win while going back to my initial estimate (0.5 WAR decline per year), those 11.0 WAR are instead worth $73.8 million; bracketing the decline 0.1 WAR in either direction as I did above yields values of $78.1 million and $69.6 million.
If I'm particularly generous at every turn, starting with 3.8 WAR for 2014 — the highest value yielded by my attempts to adjust for playing time and position-shifting — with a decline of 0.4 per year, and $6 million per win, that bumps the yield to 12.8 WAR and $86.2 million. At a decline of 0.5 WAR per year, that's 12.2 WAR and $82.0 million; at a decline of 0.6 WAR, it's 11.6 WAR and $77.8 million, and even a decline of 0.7 WAR per year yields 11.0 WAR and $73.5 million.
All of these estimates are above $60 million over four years, and most of them are below $80 million, for a range of annual salary between $15-20 million. By comparison, McCann received $17 million per year as a catcher who's two years younger than Napoli and is expected to transition to first base or DH by the end of his contract. Moreover, he did so coming off a season in which he set a career low for playing time and didn't quite recover to his pre-injury level with the bat. Like Napoli, he also carried the cost of a lost first-round pick as a player who had received a qualifying offer. Thus, I think it's reasonable to expect Napoli to match that annual value and bring home something in the neighborhood of four years and $68 million. In the unlikely event he finds a taker for five years, I'd expect to see a drop in average annual value, but I expect his hip condition, dormant as it may be, will prevent that from happening. On the other hand, I wouldn't be surprised if he returns to Boston on a three-year deal at a slight premium above $17 million, with some kind of vesting option to go to a fourth year. Like any bopper in this limited market, he's going to get paid.