[CP Story] Bridge over Troubled Water: Gaudreau Contract

[Lord Carnage]

Originally Posted by Hot_Flatus

To me it seems like a lot of people are stuck in the mindset of signing player x to compliment your stars - which is pretty oldschool. The good teams today rarely do this anymore and if they do it's more of a one off to put them over the top when they feel they have a legitimate shot. All the model franchises pay 3-4 of their top forwards well and surround them with good, young affordable talent now. It's not like BT is going to need to go out and constantly sign 4M dollar FA deals if he's done his job right in another few seasons. Next man up instead of let's go shopping.

The Flames are developing a steady line of prospects/homegrown talent that can come in and play for reasonable money so the franchise can afford to pay the likes of Monohan and Guadreau. It doesn't happen overnight, obviously, but why even rebuild if you are going to potentially alienate one of the leagues star players that can make the franchise great over a few dollars and cents?

Yup - perfectly reasonable. I'm still trying to figure out at what point that makes it ok to pay someone more than you should have to?

[Lord Carnage]

Originally Posted by GranteedEV

On the flip side, such money as an RFA is lower risk because the player is in their prime, while the same money as a UFA is high risk because regardless of history, the player is past his prime production years.


Paying a 23 year old Johnny a so-called overpayment is a good gamble. Paying a 28 year old Johnny so-called market value is a likely losing one in its later years.

The first part of your statement is 100% right. That's one reason, I'm sure, that Brower didn't get 7 years.

I still don't get why anyone should overpay for anyone, period. Especially a RFA with not even arbitration rights.

You pay more for Johnny than "Stajan" because he is a better player. You don't overpay for Johnny because he is a better player, just pay for him.

[Textcritic]

Originally Posted by Hot_Flatus

To me it seems like a lot of people are stuck in the mindset of signing player x to compliment your stars - which is pretty oldschool. The good teams today rarely do this anymore and if they do it's more of a one off to put them over the top when they feel they have a legitimate shot. All the model franchises pay 3-4 of their top forwards well and surround them with good, young, affordable talent. It's not like BT is going to need to go out and constantly sign 4M dollar FA deals if he's done his job right in another few seasons. It shifts to next man up mentality instead of let's go shopping...

I don't believe this is true. The Pittsburgh Penguins payroll for this past season included six forwards earning +$3.5 m, and the Stanley Cup finals SJ Sharks roster included five. The Sharks were paying quite a bit more for defensemen, but for each team I think the numbers tend to balance out depending on how they structure their own systems of play. The point here being that it is probably more accurate to say that good teams will pay eight or nine players, and then surround them with affordable talent.

[Gaudreauvertime]

Originally Posted by Bingo

sorry ... what do you mean?

I would question you're assumption that the Tarasenko contract serves as a straight comparable without adjusting for career production, which was certainly a consideration when Monahan got signed (as compared to Scheifele's deal)

I think the best approach is to first find a way to normalize recent big RFA signings. I ran a non-linear optimization with the target of minimizing absolute variance of predicted vs actual contract AAV. The decision variables were the value of RFA years for each individual player, running it along sensitivities for the % delta between RFA and UFA years.

Essentially, if we believed the relationship between RFA:UFA years was 2:3, meaning UFA years are 50% more valuable than RFA years(R=50%), we could hypothesize the values of these recent signings.

Below is what that first run looks like, assuming 2.5% inflation to normalize Tarasenko's deal.


Once we get these estimated RFA values, I make the value judgement that the RFA AAV of Tarasenko:Scheifele ~ Gaudreau:Monahan, as both the Calgary players have the better career history than their comparable, but the actual performance in contract year is more debatable.

If we instead believe the R=100%, that UFA years are twice as valuable as RFA years, we get the following result.


Based on the UFA values you'd need to believe to make the R= 100% work, I'm more inclined to go with the R=50%. That would give the following AAV's depending in inflation:


Hope this approach makes sense. Its not perfect but its a bit more holistic, and the values seem reasonable (I'd buy that Gaudreau is a $9.88M player as a UFA in 6 years, especially when you adjust for inflation).



I also think you are under selling Gaudreau's all around game here:

"But NHL clubs in the modern era are built with franchise players that do it all, and at this point it’s hard to argue that Gaudreau is a complete player that helps out in every situation. He’s elite on the offensive side of the puck but won’t kill a big penalty, be deployed to shut things down in a the last minute with his team up, nor lead the team through the trenches with an impassioned speech."

I also think you might want to check deployment of Gaudreau in the last minute to protect leads - he was used by Hartley with high frequency in those situations. Lastly, Gaudreau was a tremendous PK'er in college and has said he wants to play the PK. There is no doubt in my mind that he could definitely be put out to kill a big penalty.

[Robbob]

If you go with UFA being 1.75 times RFA I personally think you will get closer to the right number.

[Bingo]

Originally Posted by Gaudreauvertime

I would question you're assumption that the Tarasenko contract serves as a straight comparable without adjusting for career production, which was certainly a consideration when Monahan got signed (as compared to Scheifele's deal)

I also think you might want to check deployment of Gaudreau in the last minute to protect leads - he was used by Hartley with high frequency in those situations. Lastly, Gaudreau was a tremendous PK'er in college and has said he wants to play the PK. There is no doubt in my mind that he could definitely be put out to kill a big penalty.

First off very interesting.

I think where it gets a little busy though is the inflation rate in a contract as most deals get signed somewhat straight lined and if not they get ledged, often with the ledges at the RFA/UFA kick point (from what I've seen, haven't done the research).

I'd be the first to admit that I used nice easy round numbers for Tarasenko at 6 for RFA and 9 for UFA but it could have been almost any combination.

Using Tarasenko as a comparable is pretty solid given when the player became prolific, and almost everyone is using it.

I for one would argue that he's already over paid because he's somewhat of a one trick pony and found the pine a lot in the playoffs when the games were close.

The crappy thing about this argument is that to disagree with you comes across as anti-Gaudreau which I'm not. Love the kid and I hope he stays in Calgary long term, but you have to get him into a contract that makes sense.

And I'm sorry but killing penalties in college doesn't suggest he ever will in the NHL, some things just don't translate. Like the number of players that were scoring stars in junior hockey but now play bottom six in the show.

Bottom line Stamkos and his resume just signed almost exactly the $8.5M x 8 year deal that is being rumoured, and he had the leverage do do so. Gaudreau doesn't.

And finally ... hopefully that's a bunk rumour and this is all about a lockout clause and is going to be signed soon. Lord knows Giordano's contract and what the rumoured asking price from his agent were not the same.

[CliffFletcher]

Originally Posted by Hot_Flatus

To me it seems like a lot of people are stuck in the mindset of signing player x to compliment your stars - which is pretty oldschool. The good teams today rarely do this anymore and if they do it's more of a one off to put them over the top when they feel they have a legitimate shot. All the model franchises pay 3-4 of their top forwards well and surround them with good, young, affordable talent. It's not like BT is going to need to go out and constantly sign 4M dollar FA deals if he's done his job right in another few seasons. It shifts to next man up mentality instead of let's go shopping.

Which teams actually do that? I can't think of a single team that became a Cup contender built strictly on core of highly-paid players surrounded by cheap, home-grown talent. Sure, that's the ideal. But no NHL team has demonstrated the kind of drafting and development you would need to fill every roster spot with home-grown talent.

The Flames do not have a Brouwer or a Frolik in the pipeline. They just don't. If they played the wait and develop strategy, the primes of Gaudreau, Monahan, and Bennett might come and go without the Flames ever surrounding them with quality support. There's a reason internal budget teams (Nashville, Anaheim, Ottawa, etc) have chronic trouble making it over the hump.

[Gaudreauvertime]

Originally Posted by Robbob

If you go with UFA being 1.75 times RFA I personally think you will get closer to the right number.

at 2.5% inflation (conservative)
$6.81 for 6 yrs
$7.35 for 7 yrs
$7.76 for 8 yrs

Originally Posted by Bingo

First off very interesting.

I think where it gets a little busy though is the inflation rate in a contract as most deals get signed somewhat straight lined and if not they get ledged, often with the ledges at the RFA/UFA kick point (from what I've seen, haven't done the research).

I'm not talking as much about dollar inflation as I am cap inflation, which manifests secondarily in AAV inflation over time.

Originally Posted by Bingo

I'd be the first to admit that I used nice easy round numbers for Tarasenko at 6 for RFA and 9 for UFA but it could have been almost any combination.

Using Tarasenko as a comparable is pretty solid given when the player became prolific, and almost everyone is using it.

I'm challenging the assumption the Tarasenko should be used as a 1:1 comparable. It would be like signing Sean Monahan to an 8 year 6.125M deal because that's what Scheifele got and he's Monahan's comparable. Sure, it can be argued that Scheifele was every bit as good as Monahan last season, but Monahan's career production is what got him paid a 5% higher AAV despite signing for only 3 UFA years instead of 4.

The historical precedent for financial valuation of players is point production. Over their respective careers, Gaudreau has dwarfed Tarasenko in this key metric.

I for one would argue that he's already over paid because he's somewhat of a one trick pony and found the pine a lot in the playoffs when the games were close.

That's a fine opinion, but it doesn't change the fact that the market has been set. Regardless, I don't recall Tarasenko being benched in the playoffs the in his contract year, and his perceived lack of dimension has no bearing on Gaudreau, especially considering that Gaudreau is indeed a complete player.

Originally Posted by Bingo

The crappy thing about this argument is that to disagree with you comes across as anti-Gaudreau which I'm not. Love the kid and I hope he stays in Calgary long term, but you have to get him into a contract that makes sense.

That's not at all true. What comes across as anti-Gaudreau is blaming him for the lack of a signed contract with no evidence, which you have not done.

And I'm sorry but killing penalties in college doesn't suggest he ever will in the NHL, some things just don't translate. Like the number of players that were scoring stars in junior hockey but now play bottom six in the show.

There is very little doubt that with his defensive awareness and quickness, he'd be an excellent penalty killer. That's probably why he was used late in games so much last year.

Bottom line Stamkos and his resume just signed almost exactly the $8.5M x 8 year deal that is being rumoured, and he had the leverage do do so. Gaudreau doesn't.

Stamkos was also far less productive last season, and his productivity has been declining following injury issues. And that 8 year deal takes him to 35 . . . Do you pay a player for what they have done or what they are likely to do over the term of their contract. My bet is that Johnny scores a lot more points than Stamkos over the next 8 years.

[Vinny01]

Originally Posted by Bingo

First off the Flames have to treat the player and his agent with class.

I think when things get to the Risebrough point and you lose a Nieuwendyk you've blown it. A hard line is a hard line but it doesn't have to be with insults.

I don't think Gaudreau is an overpayment based on skill. But if he is looking for 8 years and 8.5M (example, don't know) he's asking for Steven Stamkos number without having two very important things

1. A history of production (2 years isn't 8)
2. the ability to solicit offers from the other 29 teams

The structure of his contract just doesn't get them there.

Treliving has to continue to point that out in the classiest way possible.

I think the Stamkos argument is a poor one as it is clear he didn't maximize his earning power. There was talk to $10-$12M per for him if he chose Buffalo or Detroit. I hope Johnny takes less to build a winner here but I think paying him $8.5M is better than trading him. I think $8.5 is rich myself but I would rather do that then teade him for a mix of futures and players now and keep the likes of Brouwer and Frolik on the team.

I also don't want people to misconstrue that I don't see value in those 2 UFA's. If given the option of keeping those 2 and their combined $8.8M cap hit and lose Gaudreau or pay Gaudreau $8.8M per and trade those 2 the answer is easy for me. Give me the 23 year old potential generational talent over 2 above average veteran forwards. That is an extreme comparison that doesn't take into consideration trade returns etc but my point from the get go is giving Johnny big money (north of $7.5M per) is not something that I would be upset about and certainly wouldn't prefer the alternative of trading him because we would never get that value back.

I also agree with treating the player with class which I have no doubt the flames have done. I also respect them for trying to get the best deal possible and Treliving has been a pretty solid negotiator thus far. The only thing I have really been an opponent of was MMF stating that if Johnny pushes for the max we should consider letting him go as we need money for the Bennett's, Tkachuk's and Gillies down the road. My response to that is I rather pay our superstar and dump the guys like Brouwer and Frolik then get rid of Johnny tobacco date those extensions.

This could all come down to what is a gross overpayment. In my mind it is $10M per but anything less I could get behind as long as we max out the term. I truly think Johnny Gaudreau will be on par with McDavid in terms of being one of the main faces of the NHL for the next decade

[Enoch Root]

Gaudreauvertiime: you keep repeating the one point that Gaudreau's production has been higher than Tarasenko's.

First, there are other metrics and considerations. Deals of this size simply don't get done based so heavily on a singular metric like you are presenting here.

Second, you are basing that on points, and as it has been mentioned several times in this thread (and/or others), goals typically garner more bucks than assists. Not saying they should, just saying they do - or appear to.

[Vinny01]

A good question for those in the discussion is what contract for Gaudreau is unacceptable in your opinion?

To me anything 5 years in length is absolutely terrible and even 6 years I am not happy unless the AAV is above $6M

If the Flames max out the term anything over $9M per is too rich.

In no case do I want the Flames to trade Johnny and am leaning toward giving him 8-9M if that means he signs the max term than giving him the chance to walk in 5-6 years.

[Hot_Flatus]

Originally Posted by Textcritic

I don't believe this is true. The Pittsburgh Penguins payroll for this past season included six forwards earning +$3.5 m, and the Stanley Cup finals SJ Sharks roster included five. The Sharks were paying quite a bit more for defensemen, but for each team I think the numbers tend to balance out depending on how they structure their own systems of play. The point here being that it is probably more accurate to say that good teams will pay eight or nine players, and then surround them with affordable talent.

The average salary is probably right around $3M this year so that would hardly mean that player is getting paid anything exorbitant. I'm not sure why you have chosen that as a basis for your post.....If you're talking high end salary (which I was) it's crystal clear that both teams you mentioned are only paying 3, maybe 4 fowards big NHL money that top scorers would deserve to be paid.

Search for yourself:http://nhlnumbers.com/

There are a few exception but the better teams definitely seem to stick to this tactic. The best franchises seem to have numerous, young cap bargains filling out the bottom lines making the high dollar deals much more doable.

[Enoch Root]

Originally Posted by Vinny01

A good question for those in the discussion is what contract for Gaudreau is unacceptable in your opinion?

To me anything 5 years in length is absolutely terrible and even 6 years I am not happy unless the AAV is above $6M

If the Flames max out the term anything over $9M per is too rich.

In no case do I want the Flames to trade Johnny and am leaning toward giving him 8-9M if that means he signs the max term than giving him the chance to walk in 5-6 years.

Unacceptable term (starting from the worst):

5 year
1 year
4 year
6 year

Unacceptable dollars:

8 years: north of $7.5M (and probably north of $7M - would rather go down a year to keep the cap lower)
7 years: $7M
6 years: $6.5M
3 years: $5M
2 years: $4.5M

[Enoch Root]

Originally Posted by Hot_Flatus

The average salary is probably right around $3M this year so that would hardly mean that player is getting paid anything exorbitant. I'm not sure why you have chosen that as a basis for your post.....If you're talking high end salary (which I was) it's crystal clear that both teams you mentioned are only paying 3, maybe 4 fowards big NHL money that top scorers would deserve to be paid.

Search for yourself:http://nhlnumbers.com/

There are a few exception but the better teams definitely seem to stick to this tactic. The best franchises seem to have numerous, young cap bargains filling out the bottom lines making the high dollar deals much more doable.

EVERY team has as many of these as they can (because they are desirable).

That does not, in any way, prove that successful teams don't sign players like Frolik or Brouwer.

[Hot_Flatus]

Originally Posted by CliffFletcher

Which teams actually do that? I can't think of a single team that became a Cup contender built strictly on core of highly-paid players surrounded by cheap, home-grown talent. Sure, that's the ideal. But no NHL team has demonstrated the kind of drafting and development you would need to fill every roster spot with home-grown talent.

The Flames do not have a Brouwer or a Frolik in the pipeline. They just don't. If they played the wait and develop strategy, the primes of Gaudreau, Monahan, and Bennett might come and go without the Flames ever surrounding them with quality support. There's a reason internal budget teams (Nashville, Anaheim, Ottawa, etc) have chronic trouble making it over the hump.

There's a big difference between having "strictly" homegrown talent and having a healthy pipeline of young talent. I don't recall saying "strictly" at any point.

Team like SJ, Chicago, STL are not hampered by paying their top 3-4 forwards big money and relying heavily on the draft, shrewd trades and the odd cheaper FA signing. I don't see why the Flames would be any different in this regard?

In my opinion, the need for excessive cap space is a whole lot of smoke and mirrors. You don't want to be up against the ceiling but as far as the Flames are concerned, paying Johnny 7.5-8.0M per would certainly not cripple them or put them out of the norm for a player of his caliber.

[Cube Inmate]

Loved the story Bingo...lots of thought-provoking stuff in there.

Given that we're now bumping up against the supposed break in negotiations, I'm a little frustrated and worried about all of this. And honestly, Gaudreauvertime has convinced me that Johnny's agent (a.k.a. Gaudreauvertime) is probably coming up with some pretty ridiculous demands here. I don't disagree that the kid's VALUE to the team is (IMO) easily in the $8M/year range already...at age 23 or whatever he is. But BT would be foolish to pay that in a buyer's market (i.e. RFA w/o offer-sheet eligibility).

There's zero doubt in my mind that JG would have been signed 8x8.5 by now if he were in EDM or VAN, and that's got to be a frustrating thought for Johnny('s agent).

[Textcritic]

Originally Posted by Gaudreauvertime

...I'm challenging the assumption the Tarasenko should be used as a 1:1 comparable. It would be like signing Sean Monahan to an 8 year 6.125M deal because that's what Scheifele got and he's Monahan's comparable. Sure, it can be argued that Scheifele was every bit as good as Monahan last season, but Monahan's career production is what got him paid a 5% higher AAV despite signing for only 3 UFA years instead of 4...

I have seen you make this claim three or four times now, but I am unconvinced that this is an established fact. It seems more to me like an outside interpretation of the way the numbers break down when comparing his contract to Scheifele's, but I think it is entirely probable that his higher AAV is based on an expectation that Monahan is a better player.

[Hot_Flatus]

Originally Posted by Enoch Root

EVERY team has as many of these as they can (because they are desirable).

That does not, in any way, prove that successful teams don't sign players like Frolik or Brouwer.

Again, I never said that successful teams don't sign these types of players....I said that they don't need to go out and do so all the time. This should be the ultimate goal. Many posters are using the need for cap space as an argument to play hard ball with Guadreau.

If every team has these good, cheaper, young players in abundance, then how many good, young, relatively cheap players are on our bottom 6 in Calgary? How about the Oilers? The Leafs? Compared to some of the model franchises its alarming what bad teams invest in bottom 6 players.

[Gaudreauvertime]

Originally Posted by Textcritic

I have seen you make this claim three or four times now, but I am unconvinced that this is an established fact. It seems more to me like an outside interpretation of the way the numbers break down when comparing his contract to Scheifele's, but I think it is entirely probable that his higher AAV is based on an expectation that Monahan is a better player.

But Scheifele was arguably the better player last year by a non-trivial amount, taking a big step forward, whereas Monahan did not. But Monahan has the better career track record, hence the bigger pay day for less term.

[Gaudreauvertime]

Originally Posted by Enoch Root

Gaudreauvertiime: you keep repeating the one point that Gaudreau's production has been higher than Tarasenko's.

First, there are other metrics and considerations. Deals of this size simply don't get done based so heavily on a singular metric like you are presenting here.

Second, you are basing that on points, and as it has been mentioned several times in this thread (and/or others), goals typically garner more bucks than assists. Not saying they should, just saying they do - or appear to.

But Gaudreau had scored goals at a higher rate by his contract career, too.

55g in 160 gp - 28.2 goal pace
64g in 193 gp - 27.2 goal pace

Is Scheifele a better goal scorer than Monahan after one season of scoring at a ~25% higher goal scoring rate? No, you do what Treliving did for Monahan and consider the while body of evidence.