Letting Machado Walk

I had an interesting conversation the other day with someone who works in an MLB front office for a team other than the Baltimore Orioles.  He said to not put any weight into the media reports.  He thought that, yes, many teams are talking with the Orioles about Manny Machado, but that the reported players involved are all asks from the Orioles and not actual names bandied about in a near to completion deal.  He said that the window for Machado helping another club is closing and, if the Orioles refuse to take on money for whatever reason, that the actual worth would be similar to what the Tigers got for J.D. Martinez last year.

At the time, Martinez was carrying a 1.6 bWAR as a corner outfielder and, for comparison, Manny Machado is carrying a 2.4 bWAR as a shortstop with a half dozen extra games.  The offensive powerhouse in J.D. Martinez netted the Tigers three Arizona Diamondbacks minor leaguers: Dawel Lugo, Sergio Alcantera, and Jose King.  It was somewhat of a surprising deal because Martinez was/is a strong bat and that trio of position players is underwhelming.  None of the position prospects were considered top ten organizational prospects for the Diamondbacks and currently are not considered top ten guys for the Tigers. Neither system is particularly strong and Jose King, in fact, is considered something of a non-prospect.

So, the Martinez deal would suggest that the Orioles getting a fringe top 100 prospect might be a bit of a fantasy.  If this is the case, then it would make sense to play Machado out for the rest of the year and take the draft pick compensation.

Yes, I recognize that sounds astounding.  A year and a half ago, I was noting how Machado was worth a major haul.  Times have changed.  Salaries have changed.  And it is possible that the smartest move is to let Machado walk.

Why?
Let us talk about value.

Rank	Position	Pitcher
1 to 10	81 MM	73 MM
11 to 25	66	46
26 to 50	38	32
51 to 75	24	20
76 to 100	20	15

When we talk about surplus value, we are discussing the average production historically from players like this against the average cost in salary through the final year of arbitration.  What the Tigers got for Martinez is far less than what this table assesses.  What we would think for the Tigers get would be something akin to a trip of C/C+ level prospects with a total value of about 10 MM.  You can see comparables with respect to how much similar prospects are worth in trades for international bonus money.  That all said, 15 MM is probably a fair assessment.

Now, what could the Tigers have expected for Martinez.  He was performing at a 1.6 bWAR clip on a 11.75 MM deal.  He had about 5.5 MM left and would have been expected, if he maintained his WAR pace to be worth about 1.2 WAR the rest of the season, which is worth about 10 MM.  Take away his salary and you have a 4.5 MM surplus player.  The club netted about 10 MM.

Compare that to Manny Machado.  Machado is working on a 16 MM deal with about 7 MM left.  At his current 2.4 bWAR pace, you could expect him to offer another 1.5 bWAR for the remainder of the season.  That is worth about 12 MM.  Split the difference and we are talking about 5 MM in surplus value.  That expected value would put Machado on par with getting a return of only Sergio Alcantera.

That exercise feels incredibly low, but the front office person I was talking too suggested that really is not an off base assessment.  Machado is a great player, but he is not a shortstop and he has money left on his contract that teams will need to find ways to squeeze in.  On top of that, draft pick compensation might be a better path to take at this point.

Draft Selection	Surplus Value
26 to 30	17
31 to 35	14
36 to 40	12

If the Orioles would hold onto Machado and let him walk at the end of the year, they would be expected to pick somewhere between 26 and 35 in next year's draft when another club signs Machado.  Minus the 7 MM left to him and you have a 7-10 MM value, which is more than getting a fringe top 10 organizational prospect.  Additionally, this avenue would enable the next General Manager of the Orioles to better dictate how to appropriate resources as opposed to relying on the current decision makers deciding what is the best way for their allocation.

One hopes this is not the scenario that is unfolding.  While the expected performances seem accurate, the hope is that the value of Machado is much higher.  The hope is that the promise of playoff games increases not only the value of a win, but also the opportunity to get value from Machado.  The hope is that being able to tie all that performance into one player would also bring back a premium.  The hope is that the uncertainty in JD Martinez not being able to competently play the field depressed his value and that Machado's insistence on playing shortstop is not a true limiting of his positional flexibility to a team playing competitive baseball.

That all said, I think it is important to recognize that the trade market might be a lot drier than what the media may be presenting it to be.  It could very well be that the offers on the table for Machado are underwhelming and could potentially be so underwhelming that the Orioles might be better off keeping him on the team and letting him walking, pulling back only the value of a compensation draft pick.