Valuing Cordero and Linebrink

The Milwaukee Brewers have lost two members of their bullpen in the free agent market: Francisco Cordero and Scott Linebrink. Both signed four-year deals, with Cordero going to the Reds for $46 million and Linebrink going to the White Sox for $19 million.

Once again, I am astounded at the dollars that teams are handing out to relievers. The contract for Cordero is simply awful. If the Reds are trying to be taken seriously by flashing some dollars, then flashing their money is all they are accomplishing. Cordero is an excellent reliever, but I don’t see how the Reds can justify spending $11.5 million/year for four years on a pitcher about to turn 33 for a team that doesn’t appear to be built for success in this timespan. Adam Dunn and Ken Griffey are gone after 2008 and Arron Harang and Bronson Arroyo are due big raises. I understand that there may be help coming from the farm, but I do not think that expectations are rosy enough to justify spending big money on a closer just yet. If the Reds put that money in other places, I believe the team would be more competitive in the near term.

Even if the Reds could use this final piece, I still think it’s a bad deal. I have Cordero producing $19.6 million over the next four seasons—$26 million more less than he’s being paid. Now, it’s pretty clear that my model isn’t predicting well for “closers.” And while I’m a believer in efficient markets and willing to acknowledge that I might be underestimating closer value, the current closer premium is excessive. And I think that Scott Linebrink’s contract supports my contention.

I have Linebrink’s four-year deal valued at $17.1 million—two million less than the salary he is actually getting, so it’s not too far off from my model. (I don’t like the signing either, because I don’t like signing relievers to long-run deals for other reasons.) However, my model estimates that Cordero is worth only about $2.5 million ($0.6 million/year) more than Linebrink. The main difference between the two pitchers is that Cordero normally pitches in the ninth, while Linebrink pitches in a set-up role. And even if I grant that the later innings have more impact on the outcome of the game than earlier innings, Linebrink’s value ought to be governed by opportunity cost, not where he’s pitched in the past. There are plenty of teams out there that could have picked up Linebrink and made him a closer. Though the White Sox plan to use him in the set-up role, they need to compensate him for the forgone closer dollars he is passing up.

I’m not saying that we can pin down the exact value of relievers here, but it does reveal the difficulty in valuing pitchers according to their roles. Middle relievers and starters limit the need for closers and teams can shift pitcher roles with ease. But, what I am certain of, is that the Reds are going to regret this contract, even if Cordero pitches well. And I think there is a decent chance that he collapses, as relievers often do. He’s got a big contract, and even if the Reds decide to trade him, I will not be surprised if the team has to send along some cash to cover part of his contract.

7 Responses “Valuing Cordero and Linebrink”

  1. mraver says:

    Two comments:

    First, I’m surprised to see how closely you project the values of Cordero and Linebrink. The latter has been in something of a steady decline over the last few years while Cordero had what looks like a career year last year (ie, he hasn’t really be on the decline). Linebrink has been more durable over the course of his career, but I’d be surprised to see that make up for the large difference in K-rates (10+ vs. 7-8).

    Also, I’ve heard many people mention that they don’t like giving long-term contracts for relievers. Now, in general, I support the bullpen-from-within approach. But when you do sign a reliever, I have no problem doing a 3 or 4 year deal, simply because every time you sign a guy, you’ve got to give up a draft pick (assuming he’s any good). This is a VERY high cost considering how less valuable relievers are when compared to say starters or position players. So you don’t want to be giving up your first rounder every year. This is avoided by giving out a longer-term deal.

    But I dunno. Maybe if you do the short-term thing you get a draft pick back the next year from offering your departing guy arbitration (assuming the team that signs him doesn’t have a protected pick or whatever…).

  2. cpadgett says:

    Not sure where you did your research but Harang and Arroyo signed extensions before last season. They are both locked up through 2010 with club options for 2011.

    You should also take in to consideration that we took him away from another team in the division so that becomes an added bonus plus the other team trying to sign him was Houston. So they basically kept 2 divisional teams from getting an all star closer and filled the weakest spot on their team.

  3. tangotiger says:

    FWIW, I have Cordero at a 4/26 value. This includes the higher leverage opportunity to be able to use him as a closer. Without the closer aspect, he’d be close to JC’s number. (Figure about a 50% bonus to be able to match quality players to crucial situations.)

  4. JC says:

    Harang and Arroyo are locked into contracts that escalate in payouts over the next few years.

    Cot’s Baseball Contracts

  5. Pizza Cutter says:

    JC, looking at the closer premium, I think it becomes very clear that GMs are behaving irrationally in this market. Or at least, they’re behaving rationally within a false belief that saves = good pitcher.

  6. Mark says:

    Cordero is a good pitcher though. His peripherals are great and have been for many years. I think the market is just getting to be higher price for RP. Even though it looks over payed now, in 2 years it might not look that bad.
    I know that relief pitching is “lucky” in that 1 bad outing can skew the overall stats, but the thing is a pitcher like Cordero has strong and steady peripherals to suggest he will keep up the pace. The value is in expecting these results.

    Cordero Linebrink
    10.30 8.55 2005
    10.04 8.09 2006
    12.22 6.40 2007

    3.91 2.81 2005
    3.82 2.62 2006
    2.56 3.20 2007

    0.65 0.49 2005
    0.84 1.07 2006
    0.57 1.54 2007

    .326 .270 2005
    .326 .296 2006
    .341 .274 2007

    The general trend here is a considerable decline in Linebrink and maybe slight incline for Cordero.

    Overpaying is relative. If every deal if overpaying then can it really be overpaying? It seems to happen every year that the GMs are overpaying for FA’s and I just don’t believe it with few exceptions (Zito, Pierre). The system your using that determines a relievers probably hasn’t adjusted to the new market.

  7. Nick Kowalski says:

    Closers are over rated. The Setup guy is just as important as the Closer. They both have the same chances of blowing the game just different innings. If Weathers blows it in the 8th, Cordero won’t pitch the 9th. While acquiring Cordero gives them the ability to place Weathers in 8th where he was in the 9th, it helps. But Weather is a year older and who knows how much longer he can do it.