Royals and Giants deal: A Comparative Advantage Win-Win?
Today, the San Francisco Giants traded starter Jonathon Sanchez and prospect Ryan Verdugo to the Kansas City Royals in exchange for center fielder Melky Cabrera. In 2011, the Giants’ offense was 22nd in bWAR and 27th in wOBA, while the Royals’ offense was 10th in bWAR and 7th in team wOBA. San Francisco’s pitching sat at 4th in both pWAR (22.9) and xFIP (3.66); Kansas City ranked 21st in pWAR (13.5) and 28th in xFIP (4.24). It is very apparent by looking at these two statistics that the Giants have a comparative (and absolute) advantage in pitching, and the Royals have the advantage in batting. Thus, trading pitching for offense makes a great deal of sense for these two teams. But was there a winner in this trade?
According to Matt Swartz’ Arbitration Prediction Model Cabrera should receive a contract of around $4.4 million, while Sanchez’ salary is estimated to around $5.2 million. Surprisingly, in this deal, if these predictions are correct the Royals (the small market club) will be taking on payroll (albeit only $800k), not the big market Giants. Based on last year’s statistics Cabrera (4.2 WAR, .349 wOBA) would be worth $4.4 million next season ($21 million true value for a repeat performance). However, based only on 2011, Sanchez (.6 WAR, 4.36 xFIP) is not worth $5.2 million, in fact has a true value of $3 million. But, this is only a partial analysis, because of the fact that 2011 was Cabrera’s best season and 2011 was Sanchez’ worst. On average since 2008, Cabrera has been significantly worse (1.23 WAR, .314 wOBA) including a -1 WAR season in 2010, while Sanchez’ numbers have looked much better (4.13 xFIP, 1.9 WAR). If you base their “value” on these numbers they are both worth their contracts for 2012.
The deal makes even more sense when you consider whom each player will be replacing on their new team, and who their replacement is on their former club. Sanchez joins a team, in which even coming off an injury plagued disappointing campaign he is would be a top 4 starter in the lowly Kansas City rotation. Also, by moving Cabrera, Kansas City can finally put Lorenzo Cain (the main piece in the Zack Grienke trade) in center field. Cain in 49 career major league games has a wOBA of .336 (better than every Cabrera season, except ’11) and 1.3 WAR, also he has hit a wOBA of .385 in two seasons at AAA. Cain will make the major league minimum this season, which is significantly less than the Royals would have spent to retain one of their starters, who will now be seamlessly replaced by Sanchez. Had Cabrera played for San Francisco in 2011, he would have been their 2nd best hitter only behind Pablo Sandoval. Also, with a starting rotation of Tim Lincecum, Matt Cain, Madison Bumgarner, and Ryan Vogelsong, Sanchez was not a necessary asset for the Giants, similar to Cabrera being expendable for the Royals. Barry Zito and his $19 million salary, can attempt to fill in Sanchez’ spot as the fifth starter.
From a financial and baseball performance standpoint this trade looks in everyway a win-win on paper. That is not to say, however, that after Cabrera’s stellar 2011 campaign the Royals could have got more than Sanchez for his services. Before wrapping up this post I would just like to point out the minor leaguers in these types of trades usually are left out of the conversation. So I would just like to point out that Ryan Verdugo, in his first minor league season as a starter in AA last year, posted an average K/BB ration (2.11) and an average FIP of (4.10), he was much more effective as a reliever in seasons prior to last. It will be interesting to see if Verdugo ever contributes to Kansas City in the future.
