The Economics of the Astros

I found this blog post earlier today (h/t to Rob Neyer). So, being the intrepid sports reporter that I am, I plugged in some of our Astros players and prospects to see what their relative values were. Here are the results:

Carlos Lee (4 years, 74 million left on contract). Using the spreadsheet and the historical WAR numbers from FanGraphs, I projected Lee out with WARs of 3.0, 3.0, 2.5, 2.5 for the rest of his contract. That puts his value each season at 13.7, 13.9, 11.7, and 11.7 million for the next four seasons. His net worth over the next four years is -19.1 million, meaning it will be spectacularly hard to move Lee in any deal, either by the July 31 deadline or this offseason.

Lance Berkman (3 years, 44 millions left). The final year on Berkman's contract is a club option with a 2 million dollar buyout. Looking at Berkman's WAR value this season and from the past few, I projected him at WARs of 5.0, 4.5 and 4.0 in the next three seasons. That puts his relative value in at 22.7, 20.7 and 18.4 million over that timespan, meaning he's actually a 21.8 million dollar value for the Astros. I think that means the Astros will pick up his option in 2011, unless he decides to retire.

Roy Oswalt (4 years, 61 million left). Oswalt's relative value isn't as high as Berkman's, but he does have his final season as a club option for 16 million and a 2 million buyout. My projects for Oswalt weren't as linear a decline as for the others, since pitchers generally age better than hitters. For the next four seasons, I have Oswalt's WAR at 4.0, 3.7, 3.5 and 3.0, which gives him a net value of 8.3 million. By that fourth season, Oswalt will actually be -2.1 million dollars under his contract. I'm not sure what his mindset will be, but I know he's said he doesn't want to pitch forever. I think it's more likely Oswalt retires before the end of his contract over Berkman, but either way, the Astros are getting good value.

Hunter Pence (1 year, 435,000 left). I go back and forth on Pence, thinking his trade value outweighs his real value to the Astros. Pence has one year left before going to arbitration, when his price tag will skyrocket. Still, his WAR should stay pretty steady through the next four seasons. He'll get to a WAR of 4.0 in 2009, which is around what he did in his rookie season, but fell off to just under 3.0 last season. Since he's 26 this season, he's entering his prime, so I projected his WAR at 4.0, 4.0, 3.5 and 3.5 through arbitration. That means his value will be 42.5 million dollars over what the Astros will pay him. He should get around 7 million next season in arbitration, followed by 9.7 million and 12.9 million in his final season. It'll be interesting to see if the Astros buy out any of those seasons with a long term contract before then.

Now for the prospects: By a different system, smart people came up with a way to value prospects in deals. Jason Castro is the most valuable minor leaguer in the Astros system, carrying a tag of 25.1 million. Jordan Lyles clocks in next at 15.9 million and Bud Norris is at 9.8 million. Ross Seaton clocks in at 7.3 million while Brian Bogusevic has a value of 5.5 million. The rest are all at or around a million. Pitchers like Chia-Jen Lo and Polin Trinidad (1.5 million) and hitters like Collin DeLome (700,000) and Chris Johnson (500,000) are some of the most valuable guys in the system. Those values are based off the Baseball America mid-season list and John Sickel's pre-season ratings. I'd quibble some with those rankings now, but not enough to significantly change the numbers. Still, it's very interesting to see how valuable the prospects are.

David C.

Minor Musings