Mike Trout Is A $430 Million Bargain

As reported by ESPN’s Jeff Passan on Tuesday, the Los Angeles Angels are closing in on a 12-year contract extension worth at least $430 million with outfielder Mike Trout, setting the all-time mark for both the largest contract (passing Bryce Harper’s $330 million deal from a few weeks ago) and the greatest average annual contract value in baseball history. Trout is a longtime object of fascination for us here at FiveThirtyEight; we’ve frequently extolled his virtues as baseball’s best and most consistent star. Now he has the record-breaking contract to match his talent — but one that might still represent a big bargain for the Angels. And the deal’s long-term nature only renews questions about Trout’s ability to win in L.A., as well as his potential to break through as a star off the field.

At first glance, about $36 million per year seems like a tremendous deal for the Angels. According to FanGraphs’ estimated market values based on wins above replacement (WAR), a player with Trout’s 2018 production should have been worth about $79 million last season. That’s nothing new for Trout: FanGraphs estimates that he was worth $55 million (in 70 percent of a full season) in 2017, $78 million in 2016 and $74 million in 2016. So if Trout continues his recent pace, the Angels will basically be paying him half of what he’d be worth on the open market over the next few seasons.

Of course, Trout is also 27 this year, traditionally the age at which baseball players peak. Trout’s new deal will take him through 2030, his age-38 season. Even though no player in baseball history has posted more career WAR through their age-26 season than Trout,1 it’s probably safe to assume that Trout won’t continue to be a 10-WAR-per-season machine throughout the entire life of this contract.

The old saying that “Father Time is undefeated” remains true — perhaps truer now than ever. And even star-level players peak more quickly than you might expect. While Willie Mays and Hank Aaron were superstars late into their careers, other outfielders similar to Trout — such as Ken Griffey Jr. and Andruw Jones — fell off a performance cliff after age 30 and never recovered.

Here’s a plot of the 10 retired outfielders most similar to Trout through age 26 (according to The Baseball Gauge), along with the arcs of their seasonal WAR as aging took hold:

Trout’s most similar group averaged just fewer than 1.0 WAR by age 38. And that group contains eight Hall of Famers, including Griffey, Aaron, Mickey Mantle, Frank Robinson and Mel Ott. To further complicate matters, the quality of competition in MLB continues to improve over time, and the game is getting younger, making it more difficult to age well.

However, if 1 WAR is worth $8 million in 2019, and that value inflates by 3 percent per season (for the first five seasons),2 the average of Trout’s comparable group would be worth about $450 million from age 27 through age 38. And it bears mentioning that Trout has accumulated 48 percent more WAR through age 26 than his comparable group of all-time legends. (Yes, Trout is good.)

So Trout seems like a very good bet to deliver more value to the Angels than they’re paying him for in this contract, even if some of the assumptions above are more player-friendly than the current state of baseball’s economics. While many MLB mega-contracts end up looking bad in retrospect, this Trout deal might be the rare one that delivers positive surplus value for the team.

Either way, with no opt-outs in the deal and a full no-trade clause, Trout and the Angels are committed to each other for the long haul. If Trout is interested in winning World Series rings, he took a risk in remaining in Anaheim: He has never won a playoff game with the Angels even while establishing himself at the game’s best player. As great as Trout has been, even the best player cannot do it alone — particularly not in baseball, which is a weak-link sport that is less dependent on star talent than other sports.

But in some ways, the Angels’ outlook is improving for the second act of the Trout era. Albert Pujols’s albatross of a contract is coming off the books after the 2021 season — $28 million in present-day dead money the Angels can allocate elsewhere.

The Angels entered Tuesday with $28 million committed in 2022 salaries, ranking 18th in baseball despite playing in the sport’s No. 2 market in Los Angeles. (The MLB average is $35.2 million committed in 2022, according to Spotrac.) So should the Angels want to compete in the market for high-end free-agent talent in coming years — like, say, Mookie Betts (free agency ETA 2021) or Francisco Lindor (free agency ETA 2022)3 — they will have the flexibility and purchasing power to do so.


Baseball's Mike Trout is a god of WAR


Perhaps most important for the club’s long-term prospects is the productivity of its farm system. For much of Trout’s tenure with the Angels, the club had one of the worst farm systems in baseball. The Angels’ system ranked last in baseball in 2014, 2016 and 2017, according to Baseball America. That’s begun to change. The Angels hired Billy Eppler to lead their front office after the 2015 season; they improved to 14th in the rankings in 2018 and 13th this spring.

Outfielder Jo Adell, L.A.’s first-round pick in 2017, has quickly become one of the game’s elite prospects, while starter Griffin Canning, a second-round pick in 2017, gives the Angels a second top-100 prospect. And help from the farm is not too far away: Eight of the top 10 Angels prospects are expected to open in Double-A or higher this spring. Moreover, if the Angels’ top prospect from a year ago, Shohei Ohtani, can become a consistent impact performer as a pitcher and hitter, L.A. could have two star caliber players in one roster spot.

The Angels’ biggest long-term issue is that they are in the same division as the Houston Astros, who are on the cutting edge of evaluation and player development. The Astros took home the 2017 World Series trophy, won 103 games a year ago project to win 99 games again this season according to the FiveThirtyEight model, all while maintaining a farm system that has ranked fifth or better in three of the past four years. Baseball America ranks the Astros’ farm system No. 5 in the game entering 2019.

It will be no easy task to supplant the Astros as kings of the AL West. And if Trout and the Angels can’t do that, it will be more difficult for Trout to raise his own profile, which lags well behind what his talent would suggest. Only one baseball player made ESPN’s list of the 100 most famous athletes in the world, and it wasn’t Trout — it was Bryce Harper at No. 99. This contract extension makes Trout very rich, but it also forces him to forfeit the chance to join a more likely World Series contender — and he’ll miss out on the spotlight that would have shown on him during his own free agency after the 2020 season.

So now the pressure is even greater for the Angels to surround Trout with better talent and build a winner around him. By the end of this contract, he’ll have spent two full decades with the franchise. It would be a true shame if Trout’s next 12 seasons contain as little team success as his first eight did.