Running the Numbers on a Jon Lester Extension

Is this an ace? (RLRS  Photo)

Is this an ace? (RLRS Photo)

It was reported this weekend that contract talks between the Red Sox and Jon Lester have broken off without any agreement between the two sides. Rob Bradford reports that the final Red Sox offer was around four years, $70M. This has been reported as a “lowball,” and while there is certainly truth in that, it’s also to me a pretty reasonable offer.

The problem with projecting Jon Lester is that there are two Jon Lesters. From 2008-2011 he averaged an ERA- around 75. He was a full 25 percent better than the league average pitcher, another step or two better than the average starter. He consistently threw 200 innings every year. I looked for similar pitcher peaks on the (fabulous) Baseball-Reference Play Index, and the most useful modern analogue I found is Matt Cain. In April 2012, Cain signed an extension with the Giants worth $127M over six seasons, while he was coming off a run pretty similar to Lester’s peak. There have been two seasons of salary inflation since, but that gives us a good rough estimate of what it would cost to sign peak Lester.

Of course, this isn’t peak Lester. In 2012 Lester was just plain poor. And as I showed over the offseason, Jon Lester’s 2013 came in somewhere between his 2008-2011 peak and his 2012 disaster. One thing I’ve read around the internet is that we can chalk up 2012 to the malign influence of Bobby Valentine, and we should ignore that awful season in our projections. The problem with this argument is that we’ve already seen something of a natural experiment. Lester’s ERA- in 2013 was about 90, well above the 75 he averaged at his peak. If you include his excellent postseason, the ERA- drops to about 84. Very good, but still notably worse than Lester did at his best. 2013 tested the hypothesis that Jon Lester’s bad 2012 was a meaningless fluke, and it was found wanting.

So what is a somewhat diminished Jon Lester worth? My quick salary calculator estimates that in the current climate, peak Lester would be worth a contract in the range of 6/150. Based just on his ZiPS and Steamer preseason projections of roughly 3.5 wins above replacement, Lester would project to contract around four years, $70M. The Red Sox, then, offered Lester a contract which treats Lester as precisely the pitcher his statistics say he is. They did not treat Lester as the pitcher he was three years ago, and they did not ignore his bad numbers from 2012. This contract offer was quickly rejected. Unsurprisingly, Jon Lester himself thinks that Jon Lester is much better than that.

If the Red Sox ace goes out and pitches like the Red Sox ace this season, it’s going to take a lot more than 4/75 to get him signed. That was the risk that Ben Cherington took in keeping the contract offer so low. He chose not to take tha risk of Lester being roughly the pitcher he projects to be. I have been impressed with how Lester has pitched in his first three outings of the season, but it’s hard for me to reject the statistical baseline right now. I hope Lester is great this year and the Red Sox end up having to spend a whole ton of money to keep him. But that’s just hope, and I don’t think the Red Sox were wrong, at this point, to make their contract offer based on hard numbers instead.

27 thoughts on “Running the Numbers on a Jon Lester Extension

  1. Jose

    The thing I noticed yesterday is that Lester is in the same age season that Sabathia was when the Yankees signed him to the extension in 2011/2012 off-season. That deal is looking like it might really be a bad one.

    The problem of course is the replacements. The Sox need a couple of things to happen there;
    1. Buchholz needs to establish himself a bit more conclusively
    2. Someone in the minor league group has to step up.

    I think if those things happen you can go into next year with Buchholz-Lackey-Doubront-Webster-FApitcheroflessnote (Webster a place holder for any of that bunch in Pawtucket). All things equal if the Sox are going to let Lester walk and just sign Scherzer or someone like that I’d rather retain Lester as a homegrown guy.

  2. jmurph

    MCoA, Jose: would you guys agree, though, that he’s likely to get a better deal on the market? Because that was my two-part response to the news: 1. That’s probably the right offer, but 2. Someone is definitely going to give him a 5th year.

  3. Jose

    @jmurph: I won’t speak for MCoA but I think Lester will absolutely get a better deal on the market. That’s why I think you have to be prepared to let him go. It seems to me that the top free agents are almost guaranteed to be bad deals. The catch is without a couple of those players on your roster it is difficult to be successful.

  4. jmurph

    Thanks Jose. I don’t think Lester is the guy over which to lodge this complaint, but I am a bit concerned that the lesson ownership took from the 2013 World Champion Boston Red Sox (!) is that you never have to sign a player for more than 3 years at sub-optimal wages.

  5. Karlmagnus

    The way to be successful and leverage high revenues is to sign middle tier FA and extend the best of your minor league output for ideally 2-3 years beyond their first FA season. So any spare cash the Sox have now should be spent extending Bogaerts, Bradley and (if he does well this year) Middlebrooks beyond their first FA year. What we need to do now is turn some of those minor league pitching riches into an ML starter or two, one of which will hopefully turn out elite.

    I think statistical Lester is what we have, and we should be careful of paying him more than the upper-middle-level pitcher he is.

  6. Jose

    @jmurph: It’s a good question though. I think you can be successful if you are strong throughout your roster. The way baseball is today I think there is a real benefit to having strength 1-9 at the expense of having a couple of superstars.

    Having the superstars covers up some mistakes. Once you have Mike Trout you are a bit covered if you also have Jeff Francoeur. I have a theory that two 3 WAR players are more valuable than a 6 WAR player and a 0 WAR player. The end result is the same (6 WAR) but in a key spot you can pitch around that 6 WAR player so I think a top heavy team is more likely to underperform its PR than a well balanced team (see 2011 vs. 2013).

    That’s just a theory based on no study of course.

  7. jmurph

    Dale Sams posted this 2015 rotation on BBTF:

    Lackey
    Buchholz
    Doubront
    Workman
    Capuano/Owens/De la Rosa

    And the issue is that’s probably a 3rd or 4th place rotation, right? Barring dramatic improvement from the young guys and stabilization from Buchholz. So then you assume they’ll instead sign a #1 or #2 guy to replace Lester. But who is that, and how are you going to get him at a better deal than you might get Lester? Masterson? Scherzer? Shields? I mean I’ll take all 3, but Scherzer isn’t signing for less than something like Greinke got, Shields is 2 years older, and Masterson is not exactly a model of consistency, either.

  8. Jose

    @jmurph: I don’t think that’s necessarily true. First I think there is someone out there who probably takes one of the spots. It might be a Matt Clement for Pedro Martinez style exchange but I’d be shocked if the Sox didn’t ink someone this off-season.

    Then a lot hinges on what DLR/Owens/Webster gives. The idea that that pitcher is going to be a good to very good pitcher is not a big reach. If the Sox don’t get at least a Lester if not a Lester/Buchholz out of this group of minor leaguers it is going to be a pretty big disappointment. Between Workman, De La Rosa, Webster, Owens and Barnes the Sox should be able to hit at least once or twice for the rotation.

  9. MCoA Post author

    As of right now, the 2015 starting pitching market isn’t awful. It looks pretty likely that an actual playoff ace in Max Scherzer will be on the market, and he’ll be joined by James Shields, Ervin Santana and Justin Masterson. I’d place Lester’s contract in between Scherzer and the Shields group, and it’s not obvious to me that Lester’s better than Shields or Masterson. (Masterson might well sign an extension before the season’s out, though.) Scherzer costs more, but with him you’re getting a true ace, and I’d love to get to watch Max Scherzer pitch in Fenway fifteen times a year. There will also be some interesting reclamation projects – Josh Beckett, Brandon Morrow, Josh Johnson, Dan Haren. The notion that the Sox would let Lester walk and just pocket the money goes against the vast majority of this ownership’s history.

  10. Nasty Nate

    This shows an irritating part of the sports media. The headline writer at Fox Sports uses the word “lowball,” and in the body of the article Robothal inserts “far below market value,” and it gets repeated verbatim as it moves through the sports world. And it trickles down until it’s distilled as “the Sox are trying to lowball world series hero Jon Lester, those cheap bastids.” Just because Robothal got the scoop with anonymous details about the offer, his analysis becomes conventional wisdom? If so, shouldn’t he take a little more responsibility and effort with that analysis?

    The substance of his article was that the offer was for “four years for between $70 million and $80 million.” Did he have to promise the source that he would paint that as a “lowball” in order to get the information? It sure seems like it. I say that because he brings up the Homer Bailey and Lackey contracts as being supposedly better than the Lester offer. He quotes the Bailey contract as $105m/6. That contract is pretty much equivalent to the high ened of the sourced offer to Lester – but just because 105>75, we can ignore that it is 2 years longer? But that’s mild compared to him referencing the Lackey FA deal. It is simply dishonest to tell the public that a $82/5 deal with a FREE YEAR in the event of injury is better than a $70-80m/4 year deal. Either Rosenthal does not have a firm understanding of MLB finances and contracts, or he doesn’t mind simply passing along biased analysis in order to cultivate sources. Either way, it would be better for the article that breaks the information that about the Sox offer to just relay the information, and not pollute itself with shoddy or planted analysis.

    I don’t blame Lester’s camp for using the media to frame their side. If they didn’t, some stooge writer would come out with anonymous sources about Lester’s greedy contract “demands,” and that narrative would be passed around instead.

  11. jmurph

    The notion that the Sox would let Lester walk and just pocket the money goes against the vast majority of this ownership’s history.

    I don’t mean to suggest that. I’m possibly being unclear. What I’m saying is that I’m a little worried that they’re frankly afraid of big money deals at this point, and are more likely to go the route of 2 of the reclamation project types than one of the ace/potential ace types. I have a hard time believing, for instance, that they would go to the 6/140+ that it’s likely going to take to get Scherzer (who, let’s remember, reportedly turned down 6/144 already).

    I do like Shields. Since he’ll be 33 I suppose it’s more likely he’d take 3 years, which would be pretty appealing.

  12. MCoA Post author

    What I’m saying is that I’m a little worried that they’re frankly afraid of big money deals at this point, and are more likely to go the route of 2 of the reclamation project types than one of the ace/potential ace types.

    That’s fair. It’s certainly possible, and we’ll have to see how this year plays out. I guess I feel right now that, since the Sox haven’t seen any of their targets sign elsewhere for obviously reasonable money, it’s hard to say the club has been screwing up.

    The Red Sox have in the range of $60M coming off the books this offseason. How they approach spending that money is going to go a long way to sorting out how we should feel about this front office and the free aget market, I think.

  13. Crescent

    This is an interesting post for a newbie like me. I still find it interesting, as an outsider to this stuff, how far off projections can turn out to be, and yet plans are built carefully, layer upon layer, around these projections. One major key projection of a much depended upon star player could be completely off, and the team is left scrambling.

    A few anecdotal examples of projections off the top of my head that didn’t turn out to be right, and they were totally thought to be reasonable in that timeframe.

    -When Ortiz signed one his first team-friendly contracts in his early 30s, I remember so many writing about the substantial risk that he was going to drop-off pretty quickly in his mid 30s, due to his “bad-body” type.
    So what happens? Ortiz remains with the Red Sox throughout his 30s, has a great year in 2013 in his late 30s, and the team signs another contract with him. I remember how many times we had thought Ortiz’s demise was imminent.
    -After his 2010 year at the age of 26, many were convinced Lester was a true ace, a yearly Cy Young contender in the immediate future. People were raving about how he hadn’t even reached his ceiling yet. In preseason Cy Young prediction polls picked by experts for 2011, Lester was a clear favorite, along with Felix Hernandez. It made sense: He was about to enter his age 27 year, “the prime of his career”, and he had already reeled of great years, including back to back years of 225 strikeouts.
    - The bullpen going into 2013 was thought to be the team’s greatest strength – indeed, many felt its only strength, in what most predicted would be a weak team. Turns out that, in the 2013 regular season, the bullpen was arguably the weakest link of the team, only stabilized once Uehara emerged as an unstoppable closer. Still, even in the last months of the season, there was much fretting about the bullpen because of the volatility of its relievers.
    Of course, I understand that as humans we have to try to predict the future to some extent, to, at the very least, have security and a general plan. It’s funny and ironic almost, how much forecasting the future can be such folly. People are complex; it’s not like forecasting the weather. To add another layer of complexity on top of the innate complexity of individuals – variables that we understand and try to fix in time, quite often CHANGE, and the interplay of variables creates combinations and multitudes of complexity that we can never completely understand. Once we have some semblance where we think we understood “why things happened the way they happened” , is only when they have passed, and we can understand situations in hindsight. Perceptions about past situations and how they contributed to current events is murky though, and our construals of them change over time, as we evolve, and circumstances evolve.
    There is a Zen saying that we experience our lives like we are on the edge of a waterfall. Events quickly pass us, we are always being thrust into the future. Life is a state of fluidity and constant change.
    Thanks for letting me philosophize…sorry for the damn lengthy posts.

  14. MCoA Post author

    @Crescent:

    Of course, I understand that as humans we have to try to predict the future to some extent, to, at the very least, have security and a general plan. It’s funny and ironic almost, how much forecasting the future can be such folly. People are complex; it’s not like forecasting the weather. To add another layer of complexity on top of the innate complexity of individuals – variables that we understand and try to fix in time, quite often CHANGE, and the interplay of variables creates combinations and multitudes of complexity that we can never completely understand.

    Yup. All of that.

    The amazing thing is that the projections work as well as they do, given the fact that we’re trying to predict human events. I’ve been doing a bunch of work with soccer statistics, and it’s crazy how much more difficult it is. A baseball player gets 600 plate appearances in a full season. An elite striker will attempt 100 shots, and most other soccer players attempt far fewer. In those 600 plate appearances, the plate and the pitcher’s mound are always in the same place, though the identity of the pitcher and the defense changes. A soccer player might be in any number of positions on the pitch, he might be assisted by any number of different kinds of passes, and the defense might be arranged in different ways. So we have a ton to work with in baseball, statistically, that we don’t in some other sports.

    The other issue, in any sport, is information asymmetry. We have Lester’s stats, we don’t have his MRIs or the confidential opinions of his coaches and of professional scouts. If the club either wants to offer Lester more than his baseline projection contract, or refuses to offer even the baseline contract, it might be because of information we don’t have. That information might be good, it might be bad. just because they have more information doesn’t mean they can’t screw up. Dayton Moore has scouts and doctors working for him, too.

    I don’t mean to say, in this piece, that the Red Sox are clearly in the right to offer Lester 4/70 and no more. But given what we know, I don’t feel comfortable saying I think they’re wrong.

  15. Crescent

    Actually, I can point to two pieces of evidence that indicate Lester can maintain his performance from the second half of last season to the beginning of this season.

    -Lester changed his mechanics, WITHOUT A DOUBT, in the second half of 2012. The way he himself described that, was that he was implementing new mechanics in the second half of 2012, which is why he had those terrible starts after the All Star break 2012. Torwards the end of that year, he was getting more used to these new mechanics, which is why the second half of 2012 was semi-decent. On MLB Network’s “30 teams in 30 days” this spring they had a segment where Lester physically displayed the difference between his new mechanics and his old ones. In essence, his old mechanics were causing all his pitches to arrive to the plate on a FLATTER plane, making them much easier to identify, and hit.
    As for his terrible May and June last year, I read recently that he had experienced ‘dead arm’ during that time. Farrell was the guy who talked about this. That was why they put in an extended break during the all star break, after which he came back looking like a different and refreshed pitcher.
    So there you have it, two tangible reasons that point to why Lester struggled in those months.
    *i am not sure where the links to these articles are now, but trust me on this, I have a fantastic memory, and these were very recent articles and tv segments.

  16. Jose

    Crescent – unfortunately neither of these issues is particularly useful. Taking them in reverse order the dead arm isn’t a positive sign. Pitchers who have arm problems once have them later.

    As for the mechanics I can’t get excited about that. Every player in baseball makes adjustments over time. I’d need to see something persuasive that convinces me that Lesters adjustments are more meaningful than those made by others.

  17. Crescent

    To my untrained eye, in the most recent 3 months of Lester’s pitching performance, his curveball and cutter seemed to have regained some of the effectiveness of bygone years, at least in how the hitters react to them. It seems to me that the curveball has a more deceptive snap to it, and the cutter greater tilt and depth. If you remember, between 2009 and 2010, his cutter and curveball were certifiably above average pitches.
    There was a time there when everything Lester threw looked way too hittable, based on the hitters taking such good swings at his pitches.
    Also, I think that’s a bit of blanket statement to say that Lester’s mechanical improvements don’t mean anything since “all pitchers tend to fiddle with their mechanics with little appreciable results”. A cynical eye you have there!

    -There have been cases where pitchers adjusted their mechanics and they have had a profound effect! Just thinking about it specifically, I can’t understand why certain changes in mechanics CAN’T manifest in better results. I mean, pitching prospects have been known to totally revamp their mechanics and become much better pitchers. Why can’t that happen with major league pitchers? It’s a matter of case by case.
    Also, Farrell clearly stated many times (and Nieves as well), that Lester had tweaked his mechanics, leading to improvements. Are you saying Farrell was merely painting Lester’s pitching in a more appealing way?

  18. Piehole

    @Crescent: These “tweaked mechanics” stories sound just like the “best shape of his life” stories. I’d like to see some proof. It’d be easy enough to get representative samples of pitching video of Lester during the “tweaking” phase and after during the “successful” phase and compare them.

  19. Tim Dawson

    The thing about Lester is that he’s shown himself to be a bit of head case when things aren’t going his way. Now, you can write that off as Beckett’s influence, and he didn’t exhibit this behavior much last year, especially in the second half, but I can’t think of a single pitcher who I thought was great who you could say in the 3rd or 4th inning of a game “this is where the wheels come off” after he doesn’t get a strike call that he wanted, or after a bloop hit drops in. That 2012 season Lester had was just so damn frustrating. It seemed like every game he have one or two innings where he’d get two quick outs, and then give up a couple of walks and a couple of hard hit balls, and suddenly there’s a crooked number. I love what Lester did for the Sox last year in the playoffs. I’d love for him to make the Sox regret not giving him the 9 figure contract he probably thinks he deserves and that he’ll probably get if he repeats last year. I’m very happy giving him an offer up to 4/80, and letting him walk if he doesn’t accept.

    How would you guys rate Lester/Shields/Masterson? My gut says they’re all worth just about the same for 2015. Haven’t checked the stats. Anybody have any idea if Masterson would consider coming back to the Sox? My gut feel says that Masterson will be getting somewhere around that 4/70 number that’s the low range of the Sox offer. I’d be happy with that right now. Of course, things will change quite a bit before the offseason.

  20. Jose

    I can’t understand why certain changes in mechanics CAN’T manifest in better results.

    They absolutely can but as Piehole notes this is the sort of thing we hear on a pretty regular basis. Go through the litany of Spring Training stories every year and you’ll read about tweaked mechanics, best shape of his life and other things that sound good that wind up making no difference.

    Lester is a very good pitcher and will likely continue to be. In fact I would agree that his projections probably undersell him a hair. I think the projection models sometimes get wonky with guys who have anomalous seasons like he had in 2012 (think Lowell in 2005). But I don’t think he’s going to age in an unusually positive fashion.

  21. Jose

    @Tim Dawson: Hell Tim, you can go back to Friday night when he fell apart in the 7th after a bad call. It’s still a problem.

    Ranking the guys you list I’d say Lester>Masterson>Shields. I think age is the big factor for Masterson over Shields.

  22. Dan

    @Jose:

    He fell apart on Friday night because he was over 100 pitches pitching in a close ballgame all night and Farrell left him in to go to 110+, not because of the call. The pitch that he didn’t get the call on was his last best effort to make a perfect pitch and end his night, and he executed it, and didn’t get the call. He had nothing left after that. It was completely different from the implosions of the past from what I saw. In the past he’d fall apart in the 3rd, 4th, or 5th inning after frustration over a call. This time he just looked tired and frustrated that he wasn’t in the dugout heading to the showers, having completed a very good outing.

  23. Dan

    As for extension numbers, I’d be happy to see Lester back at anything up to around 5/$110M. He’s a pretty dependable #2 or #1b starter who goes on extended runs of pitching like a real ace almost every season. That has a lot of value (especially if that hot stretch overlaps with the playoffs like it did last year).

    He also has significantly less mileage on his arm than a guy like Sabathia, so I don’t think that’s a very useful comp. Lester’s injury history is about as clear as it gets for a pitcher (unless you expect a recurrence of the lymphoma).

  24. Jose

    John Farrell is going to be fined for his replay comments.

    I think his comments were pretty mild all things considered. Given that the system definitely failed once and arguably failed a second time in two days, both against Farrell’s team, some recognition of a manager blowing off some steam seems appropriate to me.

    I don’t care about John Farrell’s wallet, he’s doing fine, but this comes off as awfully thin skinned of MLB to me. I would have preferred a recognition that replay is not perfected yet.

  25. Textbook Editor

    The extension/contract all depends on whether or not the Red Sox want $20-$22 million tied up in 1 pitcher over the next 4-5 years. It certainly seems they have the money/room to spend that, but how much of this decision is tied into looking ahead 3-6 years at the arbitration raises for Middlebrooks, Bradley, Bogaerts, etc. Sure, the next 3 years (2014-2016) they’ll be fine, but if those 3 take off (or Workman, or any of the other minor leaguers), all of a sudden you could be looking at big raises come 2017-2019 for all of them (unless you manage to get them to sign an extension wiping out some FA years). So while paying $22 million for Lester in 2015 and 2016 (and maybe 2017) isn’t going to cause you any issues, if you sign him to a 5-year or 6-year deal he’s $22 million on the books in 2018-2019 (and maybe 2020) when you may not have as much payroll flexibility given all the other deals you may have to make.

    I would hate to see him go. But I’d also hate to be paying $22 million in 2019-2020 and having that force us into moves we wouldn’t want to make elsewhere.

    I’m more or less resigned to the fact he’s gone after this year.

  26. jmurph

    @Textbook Editor:

    I’d be comfortable holding the line at 5 years. Regardless of the money, I think a 4 year offer is, in some ways, not a serious offer. Or you’re at least signalling you’re not particularly interested in bringing him back. He’s going to get 5 years from somewhere.

  27. Nasty Nate

    @jmurph:

    I think for extensions and multi-year deals, there’s no way to separate the years from the AAV.
    Lester would take a 3-year deal in an instant if the money was high enough, and the Sox would give him 10 years if the money was low enough.

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