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The good and bad of Eric Hosmer's two-year contract

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His contract should outlast that haircut.

Jamie Squire/Getty Images

On Wednesday, just hours before his arbitration meeting, Eric Hosmer agreed to a two-year deal with the Royals. This continued to champion Dayton Moore as the king of anti-arbitration and closes the book on potential arbitration hearings for the 2015 Royals. Eric Hosmer will receive $13.9 million over the next two years, broken up as $5.65 million for 2015 and $8.25 million for 2016. This deal only buys out the next two seasons with Hosmer unsigned for his final year of arbitration in 2017.

So what to make of this deal? The terms are fairly unflattering for both sides and I don't think there's a clear winner here (which kinda means it's an even move, so maybe that's good for both sides).

Steamer projects Hosmer being worth 2.3 wins while ZiPS chimes in at 2 wins. $5.65 million is valued at less than a full win so either of those projections would be swell for the Royals in regards to surplus value for 2015. For 2016 if we assume Hosmer matches the projections then there's reason to believe that in 2016 he'd be projected to be as good, possibly better given aging curves and his pedigree. Even assuming he's projected for 2 wins in 2016 then at $8.25 million that's just slightly higher than a full win (in 2015) so still the Royals are getting more surplus value.

The tempting thing about Hosmer is that he posted a 3-win season at age 23 so that's at least his potential upside as he's just one year removed from that. $5.65 million for a 3-win player would be worth over $18 million in surplus value and doubling that would be nearly $40 million over the contract terms.

This seems to be what the Royals are banking on, but the question is should they? Hosmer doesn't have a strong track record and has more poor seasons than good. They've now guaranteed Hosmer a sizeable amount for any person on Earth while capturing no potential downside (like a low-arbitration raise). Then again, if Hosmer doesn't agree to this deal and has back-to-back 3-win seasons then he's likely due to make more than $8.25M in his final arbitration year. Another concern is that they've guaranteed Hosmer basically his arbitration raise performances without making him "earn it."

What are comparable players likely to earn? Pedro Alvarez, a prospect who was touted as equally high pre and post draft as Hosmer, is estimated to make $5.5M in his 2nd year of arbitration and has been the same hitter as Hosmer for his career (both have a 104 wRC+). Mark Trumbo is a nearly as equal hitter as those two and he's projected to make $5.7MM. Neither of those players were super-two guys - as Hosmer is -  so they'll just have the traditional three years of arbitration while Hosmer will have four.

That's why it's a good deal for Hosmer. He could lose both his hands, which would 99.9% rule out him playing baseball again, and he's still guaranteed almost $14M for the next two-years and never work again. Meanwhile he didn't sign away all three final years of arbitration so even if he has a mediocre 2015, he's able to have a big 2016 and still get paid for it a final time through arbitration.

The list of first baseman similar to Hosmer from age 21-24 isn't necessarily an impressive one.

Name G PA HR BB% K% ISO wRC+ WAR
Lew Whistler 249 1030 12 8.90% 14.50% 0.126 103 3.2
John Ellis 340 1158 29 8.20% 14.50% 0.133 106 3
Dmitri Young 270 1001 19 8.90% 16.20% 0.141 105 2.8
Eric Hosmer 570 2388 59 7.40% 15.50% 0.143 104 2.4
Tommy McCraw 360 1028 17 7.60% 15.50% 0.112 95 2.3

Now how about those players age 25 season:

Name G PA wRC+ WAR
John Ellis 128 513 114 2.1
Dmitri Young 127 409 112 2.0
Tommy McCraw 151 437 80 0.4
Lew Whistler 23 94 61 -0.4

And finally age 26

Name G PA wRC+ WAR
Tommy McCraw 125 491 95 2
Dmitri Young 152 593 104 1.7
John Ellis 92 316 69 0.2
Lew Whistler DNP

Now Whistler played in the 1890's so he might have died from dysentery, but all the other three went on to basically middling to poor careers.

Let's try to expand the results a bit. Let's forget about position (which in turn means forget about WAR) and tighten the filters a bit. Here's what I came up with.

Name G PA BB% K% ISO wRC+
Carney Lansford 531 2320 6.60% 13.10% 0.127 110
Chili Davis 436 1817 7.90% 16.50% 0.152 109
Bobby Wallace 359 1527 8.40% 13.80% 0.125 104
Asdrubal Cabrera 387 1610 8.20% 15.80% 0.11 100
Harold Baines 540 2137 6.00% 13.40% 0.175 104
Chris Chambliss 387 1594 7.80% 13.90% 0.118 108
Jose Tabata 402 1538 7.80% 14.40% 0.111 103
Eric Hosmer 570 2388 7.40% 15.50% 0.143 104

There are some names there, but still not offensively an impressive list.

Maybe it's good that the Royals are banking on the upside, but first baseman with a similar offensive profile as Hosmer generally don't break out or become dominant hitters like a first baseman needs to be to provide value. After all the Royals didn't guarantee his final arbitration year, leaving the possibility of a potential non-tender if his performance declines. If the Royals turn into sellers then he has seemingly team friendly deal for the next season and a half, well within the affordability confines of any club.

Maybe it's good that Hosmer is not only guaranteeing himself money for the next two years and betting on himself for his final year of arbitration.

Maybe it's a good deal, a fair deal, for both sides.