Evaluating the Yankees' contract extension candidates

The Yankees' youth movement is well underway. The focus on the youngsters has been amplified by New York's refusal to wade into the waters of the upper-tier free agent market and the reluctance to part with anyone resembling a top prospect.  While many of these players, such as Greg Bird and Luis Severino, are far from free agency, some of the others are starting to near their walk years.  It may behoove the front office to act now and lock up a young piece or two with a contract extension.

Who might the Yankees target?  The prospects are probably too young, and players like Masahiro Tanaka and Starlin Castro have already secured long-term deals, but young assets like Michael Pineda, and Nathan Eovaldi have had success in the major leagues, and are starting to approach free agency.  Let's examine the pair of pitchers, and try to see if either may be fit for an extension.

Michael Pineda

Pineda is an interesting case.  He is arbitration eligible for the next two years, and MLBTraderumors projects him to earn $4.6 million in 2016.  He's entering his age-27 season, and is slated to hit free agency at the age of 29, after the 2017 season.

His performance in pinstripes has been inconsistent.  He owns a solid 110 ERA+ with the Yankees and a promising 3.13 FIP with the team.  Pineda has struck out nearly eight batters for every one he has walked over the past two years, but despite his flashes of dominance, he still looks very hittable at times. If the Yankees can sign Pineda to a below market extension based on his superficial statistics (he's coming off a 4.37 ERA), they could find themselves a steal.  According to bWAR, Pineda has been worth about three WAR per 200 innings pitched during his career.  Conversely, the value metrics at Fangraphs and Baseball Prospectus have pegged him for more than four WAR per 200 innings pitched (though it must be noted, the 200 inning threshold is one which Pineda has yet to cross).

He clearly has the potential to be a well above-average starter, and perhaps all that kept him from reaching that potential last season was poor luck in the form of a .332 BABIP. If Pineda begins to post results that even somewhat reflect his underlying numbers, signing an extension now could look like a bargain in a few years.

And he may have real incentive to look into a life-changing amount of money now.  Injuries have plagued his short career, and if the idea of an extension covering the next four or five seasons was broached, both sides surely would have to consider.

Nathan Eovaldi

Eovaldi also stands two years from free agency and is projected to earn $5.7 million in arbitration this year.  Eovaldi is similar to Pineda in how polarizing he is when it comes to estimating his value.  By fWAR, he has essentially been a solid three win pitcher each of the past two years, while he has vacillated between zero and two bWAR in that time frame.

Initially, Eovaldi does not seem as compelling a candidate for an extension as Pineda.  His past performance isn't as strong, as even in what was likely his finest season (2015), he still only managed a 94 ERA+, a figure that matches his career mark.  Likewise, projection systems are rather lukewarm on Eovaldi's prospects for the near-future.  ZiPS pegs Eovaldi for 1.6 WAR in 146 innings in 2016, while Steamer projects him for 2.0 WAR in 150 innings.  The projections do not seem convinced that Eovaldi turned a corner last season when he posted impressive numbers down the stretch, and maybe neither should we.

However, Eovaldi did perform quite capably as the season wore on in 2015, as he increased the usage and velocity of his splitter.  He posted a 3.67 ERA and held opposing hitters to a .239/.317/.312 slash line after the All-Star break, and if the Yankees feel those numbers more accurately reflect the pitcher Eovaldi can consistently be, there will never be a better time to lock him up.  His value isn't exactly at its nadir, but it certainly isn't as high as it will be should his second half success during 2015 translate to a 2016 breakout.

It's difficult to find direct comparisons to Pineda and Eovaldi in order to get an idea of what an extension for either could look like.  Since 2013, the only starting pitcher within two years of free agency to sign a long-term extension was Matt Harrison.  Prior to the 2013 season, Harrison signed a five year, $55 million deal with the Texas Rangers that encompassed his final two arbitration years and three free agent years, with the free agent seasons reaching an annual average value of $13 million.  A deal with a similar structure would be outstanding for either Pineda or Eovaldi, as $13 million likely won't be enough to buy even an average starting pitcher by the time these two hit the market.

The track record for extensions given to pitchers in their twenties is mixed.  Some look excellent, such as the contracts given to Madison Bumgarner and Chris Sale. Other deals, like the ones given to Homer Bailey or Rick Porcello, look more like cautionary tales, but by the time Pineda and Eovaldi reach free agency, the price for an above average pitcher on the market almost certainly will exceed a nine figure guarantee (Mike Leake just got $80 million!  And the deal might not be half bad!).  If the Yankees are confident that the superficial numbers of these two pitchers will soon start to resemble their peripherals, then extensions designed to lock in their remaining arbitration years, plus a couple of free agent seasons, would be excellent ideas.