Wild Idea: Offer O'Day the QO

[Aristotelian]

Seems crazy to make the offer to a setup man, but hear me out. O'Day has put up 2.0-2.5 wins the last three years and is on pace for another, including a 1.70 ERA last year and on pace for better than that this year. He merits a Miller type deal, way in excess of $15M guaranteed (Miller is guaranteed $36M and was reportedly offered $40M). Let's say conservatively O'Day is offered 4/$28M.

Now, with that in mind, my intention would not be to sign him, but to put pressure on O'Day to sign with the O's. Even at only $7M a year, he has every incentive to take the guaranteed money from the O's or another team. Walking away from $28M would be a very risky proposition, and as we know, nobody has ever taken a 1-year QO deal for that reason.

Worst case scenario, O'Day accepts the QO. We get a 2.0+ WAR, <2.00 ERA relief pitcher for another year at $15M. If the O's don't contend next year, he could be a valuable piece to offer for prospects and turn into the next Chris Davis/Tommy Hunter, and somebody eats $5M of his remaining salary.

Better case scenario: O'Day walks to another team and we get another pick.

Best case scenario: O's re-sign O'Day to a team friendly 4/$28M.

I am probably wrong, but all the talk about comp picks got me thinking that we should not reject the idea out of hand.

[Can_of_corn]

I would take 1/17 over 4/28.

[weams]

I would take 1/17 over 4/28.

It's close, but your ability to flip him and cut the total expense makes the longer contract probably smarter. Unless he accumulated 5/10 rights. Then no.

[ChuckS]

Seems crazy to make the offer to a setup man, but hear me out. O'Day has put up 2.0-2.5 wins the last three years and is on pace for another, including a 1.70 ERA last year and on pace for better than that this year. He merits a Miller type deal, way in excess of $15M guaranteed (Miller is guaranteed $36M and was reportedly offered $40M). Let's say conservatively O'Day is offered 4/$28M.

Now, with that in mind, my intention would not be to sign him, but to put pressure on O'Day to sign with the O's. Even at only $7M a year, he has every incentive to take the guaranteed money from the O's or another team. Walking away from $28M would be a very risky proposition, and as we know, nobody has ever taken a 1-year QO deal for that reason.

Worst case scenario, O'Day accepts the QO. We get a 2.0+ WAR, <2.00 ERA relief pitcher for another year at $15M. If the O's don't contend next year, he could be a valuable piece to offer for prospects and turn into the next Chris Davis/Tommy Hunter, and somebody eats $5M of his remaining salary.

Better case scenario: O'Day walks to another team and we get another pick.

Best case scenario: O's re-sign O'Day to a team friendly 4/$28M.

I am probably wrong, but all the talk about comp picks got me thinking that we should not reject the idea out of hand.

I don't agree that O'Day merits a Miller type deal.

Miller is several years younger and has much more dominating stuff. I don't see O'Day exceeding 30 million on the open market. 4/28 or 3/24 sounds appropriate to me.

[oriole]

O'Day would likely take the QO and that would be bad news for the O's. Between Wright, Wilson, Davies, Bundy...I think another setup man will reveal himself.

[Frobby]

Well, the Yankees QO'd Robertson last year and he turned it down to get 4/$46 mm from the White Sox. I believe he is the only reliever who has received a QO.

Frankly, though, I don't see it. I think O'Day would be crazy to turn down a QO, and I don't want to pay >$15 mm for a setup man no matter how good he is. By the way, a QO was worth $15.3 mm last year (an increase of $1.2 mm from the previous year) and I'd guess it will be over $16 mm this year and it won't shock me if it reaches $17 mm.

[weams]

Well, the Yankees QO'd Robertson last year and he turned it down to get 4/$46 mm from the White Sox. I believe he is the only reliever who has received a QO.

Frankly, though, I don't see it. I think O'Day would be crazy to turn down a QO, and I don't want to pay >$15 mm for a setup man no matter how good he is. By the way, a QO was worth $15.3 mm last year (an increase of $1.2 mm from the previous year) and I'd guess it will be over $16 mm this year and it won't shock me if it reaches $17 mm.

I'm with you. You can't QO a reliever. You just can't.

[Aristotelian]

I would take 1/17 over 4/28.

You are probably right. He could take the $1/17M and hit the market again in a year, sign a 3/$36M deal and end up earning over $50M. Then again, there is the risk of an injury, in which case the $17M is the last money he ever earns. Or, more likely, a down season, in which case he hits the market below his peak value. Maybe he gets 2/$10M after that and ends up earning about $30M for his career.

I was throwing 4/$28M as a conservative estimate. At what point would it become rational him to take the guaranteed money and years over the QO money with the risk that that is his last contract? It seems crazy that a reliever would walk away from $17M for one year, but I can see it.

Frankly, though, I don't see it. I think O'Day would be crazy to turn down a QO, and I don't want to pay >$15 mm for a setup man no matter how good he is. By the way, a QO was worth $15.3 mm last year (an increase of $1.2 mm from the previous year) and I'd guess it will be over $16 mm this year and it won't shock me if it reaches $17 mm.

Sure, but inflation would increase the value of the comp pick or O'Day's 2 WAR by just as much. Seems crazy that QO's could increase 8% a year, but I guess higher education has been that way for over 20 years now.

[Crazysilver03]

Seems crazy to make the offer to a setup man, but hear me out. O'Day has put up 2.0-2.5 wins the last three years and is on pace for another, including a 1.70 ERA last year and on pace for better than that this year. He merits a Miller type deal, way in excess of $15M guaranteed (Miller is guaranteed $36M and was reportedly offered $40M). Let's say conservatively O'Day is offered 4/$28M.

Now, with that in mind, my intention would not be to sign him, but to put pressure on O'Day to sign with the O's. Even at only $7M a year, he has every incentive to take the guaranteed money from the O's or another team. Walking away from $28M would be a very risky proposition, and as we know, nobody has ever taken a 1-year QO deal for that reason.

Worst case scenario, O'Day accepts the QO. We get a 2.0+ WAR, <2.00 ERA relief pitcher for another year at $15M. If the O's don't contend next year, he could be a valuable piece to offer for prospects and turn into the next Chris Davis/Tommy Hunter, and somebody eats $5M of his remaining salary.

Better case scenario: O'Day walks to another team and we get another pick.

Best case scenario: O's re-sign O'Day to a team friendly 4/$28M.

I am probably wrong, but all the talk about comp picks got me thinking that we should not reject the idea out of hand.

Worst case would be ODay accepts the QO and suffers season ending injury. Slightly worse case if he accepts the QO and produces 2 WAR.

Part of the reason Miller got the deal he did was because he wasn't tied to draft pick compensation. A QO to ODay pretty much kills his market.

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[Stotle]

You are probably right. He could take the $1/17M and hit the market again in a year, sign a 3/$36M deal and end up earning over $50M. Then again, there is the risk of an injury, in which case the $17M is the last money he ever earns. Or, more likely, a down season, in which case he hits the market below his peak value. Maybe he gets 2/$10M after that and ends up earning about $30M for his career.

I was throwing 4/$28M as a conservative estimate. At what point would it become rational him to take the guaranteed money and years over the QO money with the risk that that is his last contract? It seems crazy that a reliever would walk away from $17M for one year, but I can see it.

If he gets injured I'm sure he could go year-to-year with Baltimore at 1/$3.5M and beat that $28MM in the aggregate.

[weams]

If he gets injured I'm sure he could go year-to-year with Baltimore at 1/$3.5M and beat that $28MM in the aggregate.

Yes. He could.

[Aristotelian]

If he gets injured I'm sure he could go year-to-year with Baltimore at 1/$3.5M and beat that $28MM in the aggregate.

If the QO is $17M, it would take him 3 years at $3.5M to break even on the $28M and 4 years to come out ahead. Let's say he loses a year due to TJ. Does he have three or even four years left after that? He will be Age 33 next year. If he has TJ or a similar surgery, I would think he does not come out ahead of the $28M.

[Stotle]

If the QO is $17M, it would take him 3 years at $3.5M to break even on the $28M and 4 years to come out ahead. Let's say he loses a year due to TJ. Does he have three or even four years left after that? He will be Age 33 next year. If he has TJ or a similar surgery, I would think he does not come out ahead of the $28M.

On the off chance he doesn't have a career altering injury do you think he'll do better than year to year at $3.5MM?

[Camden_yardbird]

With all the money the Os are freeing up this is exactly the type of chance they should be taking.

[Aristotelian]

On the off chance he doesn't have a career altering injury do you think he'll do better than year to year at $3.5MM?

Of course, but would he take the risk? As a naturally conservative person, I would be inclined to take $28M guaranteed over $17M guaranteed with a chance to make $50M. Think of the scenarios from O'Day's perspective if he accepts the QO:

15% - career ending injury in the first year - $17M total earnings

30% - no injury, major regression and/or injury - ends up making about $5M more, $22M total

40% - no injury, but slight regression, signs for 3/$15M - ends up with $32M total

25% - no injury, continues peak level performance, since for 3/$30M - ends up with $47M

This is just back of the napkin calculation, but odds are that he probably comes out ahead if he takes the QO, but with a lot of downside risk if he doesn't.

I am not sure I really believe we should extend the QO to O'Day. Just playing Devil's Advocate for the sake of due diligence.