Estimating Anibal Sanchez’s New Deal Using Cole Hamels’ Contract Extension

Oct 13, 2012; Bronx, NY, USA; Detroit Tigers pitcher Anibal Sanchez speaks at a press conference before game one of the 2012 ALCS against the New York Yankees at Yankee Stadium. Mandatory Credit: Brad Penner-USA TODAY Sports

Zach Greinke is the top pitcher available on this year’s free agent market, but Anibal Sanchez is probably the next best. In fact, MLB Trade Rumors says he might be the fourth best free agent of this year’s class period. So while the Tigers are going to make a strong play to keep Sanchez around, every team in baseball that’s looking for top-line pitching help will be involved as well. The Tigers want Sanchez back to be their number four pitcher (in name), but there are probably a handful of teams out there that would take him as their number one, and a whole slew of clubs that would like to add him as a strong number two guy in the rotation.

Needless to say, he’s not going to be paid as a number four pitcher, because he’s worth a lot more than that. Any estimate by me regarding how much money he’ll fetch is just guesswork, but we can try to look back at Cole Hamels’ market-setting deal that was signed in late July in an attempt to gage Sanchez’s value.

Hamels, who also just finished his age 28 season, re-upped with the Phillies this summer for six years and a total of $144 million. It’s exactly paid out in an even, annualized fashion (he received a portion as a signing bonus, and would receive a portion as a buyout if his final option year isn’t picked up), but it can be effectively thought of as $24 million per year. That’s a lot of money, but Hamels has been really good.

The following is an over-simplified rather crude way to judge a player’s projected value, but it should serve my quick “let’s suppose” ballpark estimate purpose.

According to FanGraphs’ FIP-based WAR, Hamels has been worth an average of 4.4 wins above replacement per year. If the Phillies were paying for that production over the life of the contract, they would be paying roughly $5.5 million/WAR. According to the same FIP-based WAR, Sanchez has been worth an annual average of 4.0 wins above replacement for the last three seasons. If the Tigers (or whoever signs him) paid out the same $5.5 million/WAR, Sanchez would be worth $22 million per season (according to the FIP-based model). That would be a total of $88 million on a four year deal. (I’ve been hearing a lot of four-year talk with respect to Sanchez’s future deal, so I’ll reference my numbers accordingly.)

A great feature of the FanGraphs site is their provision for an easy conversion from FIP-based WAR to a WAR based on runs allowed per nine innings pitched. According to this WAR model, Hamels has a three-year annual average of 6.0 WAR. His monster deal, when viewed through this lens, pays him roughly $4.0 million per WAR. Sanchez has been worth an average of 3.1 WAR over the last three seasons according to this same RA/9 WAR model. If he was to be paid the same $4M/WAR here, he would be due to earn $12.5 million per year, or $50 million over four years.

These two figures appear to be the extreme bookends. $88 million seems far too much, but $4 million per WAR appears a bit low. This is a bummer, because I think many Tigers fans were hoping the team could land him for something like four years, $50 million. I don’t think this will happen, especially considering the number of teams that will likely place a telephone call to his agent with an offer of some sort.

It’s impossible for me to say which model teams would adhere to more closely (not that they use WAR per se, but that they have some sort of valuation model that would parallel either or both in some fashion), so it’s probably safest to use a form of averaging. Based on an average of the two models, Hamels has been worth 5.2 WAR per season over the last three years, and, based on this, his deal would pay him $4.6 million per WAR. Sanchez has similarly been worth 3.6 WAR per season, and would be worth $16.25 million per season on the same pay scale. That annualized rate would total $65 million over the life of a four year contract.

Again, I really have no real personal gage on the type of deal Sanchez will get, and a more rigorous projection model should be created to get a better look at this, but if it’s a four year deal that he’s going to get, then something in the $60-$70 million range seems like a fair bet.