Revisiting the Value of Last Year's Free Agent Signings

ST LOUIS, MO - OCTOBER 28: Lance Berkman #12 of the St. Louis Cardinals celebrates after defeating the Texas Rangers 6-2 to win Game Seven of the MLB World Series at Busch Stadium on October 28, 2011 in St Louis, Missouri. (Photo by Jamie Squire/Getty Images)

Note: this post as been updated

Back in February of this year I published a write up comparing the projected value of free agent signings based on position players' projected runs created and their 2011 salaries. The projections were based on Tango's Marcel Projections.

Now that the season is done I wanted to check back in and compare the projected dollars per run created of those free agents to their actual performance.

Here are the results by individual player (wider view available after the fold):

The chart is sorted in terms of the return each team got on their initial investment. Not surprisingly, Melky Cabrera comes in at the highest ROI--producing $19M in value for a paltry $1.25 investment. Lance Berkman's $22.4M in production (3rd highest among free agents) required only $8M (180% ROI). 

Berkman was one of the best bargains of the off-season, but there were certainly more to be found. Jhonny Peralta returned the second most value ($23M) on an even lower up-front investment ($5.625M). 

With the good also comes the bad.

The worst ROI? That title goes to Jorge Cantu, who only signed for $850K but destroyed $3.2M in value (-476% ROI).  

Adam Dunn was easily the worst non-injured regular player in this regard, totally a minuscule 36 runs created and -$13M in value all while getting paid $14M for the season--a rate of $388K per run created.

From a team perspective, Kansas City got the best return on their investment, thanks to Melky Cabrerra's fantastic season. Texas generated the most total value from their signings ($34M), which was much higher than their investment of ~$20M. The Cardinals saw the biggest ROI for a team that signed multiple players (3), at 216%. And even with the Magglio Ordonez signing, the Tigers saw their three signings return $32.4M in value, over $4M more than their initial investment.

The worst investments? Houston's signing of Bill Hall and Cleveland's signing of Austin Kearns

f we look beyond single signings, however, we find teams like the Pirates (2 for -153% ROI), the Giants (3 for -101%), and the Red Sox (2 for -86%). They Red Sox invested roughly $23M in free agents this past year (driven largely by the Carl Crawford deal), and received only $3.2M in value from those players.

Overall, free agency is mixed bag in terms of bargains. For all the position players in the data set, teams invested $287M and only received a return of $264M in terms of on the field value (an ROI of -8%). 34 players exceeded their contracts in terms of value produced, while 28 cost more than their on-field value. Partly that was due to injuries, but it was also due to players performing below expectations (and there are a slew of reasons for that, some predictable, some not). To be sure, there were individual steals to be had on the free agent market, but there were also a large number of bad deals. 

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