• Payday for Laco

    by  • March 23, 2013 • Hockey • 7 Comments

    There’s been a lot of talk recently about Ladislav Smid, what his next deal should look like and whether the OIlers are serious about signing him to it. Smid falls into a class of players whose value presents more difficulty than usual in that he has basically no offensive value and all of his value is tied up in data and stats that doesn’t really exist. Different people have different way of defining this class of player; for me, the issue isn’t whether he hits or blocks shots; it’s the fact that he’s a defenceman who logs a lot of ice time without playing on the PP. I defined a class that way: at least 19 minutes a game of TOI this year with no more than a minute on the PP. I limited myself to looking at contracts that are mostly UFA years.

    I’ve broken my group into three, based on how much the players are earning. Starting with the lowest paid group and moving up.

    Marc Methot’s a guy who’s been brought up a couple of times by Bpb Stauffer as a good comparable for Smid. On one level, I can see it: he plays a lot and has no offence. There are two problems I can see with the comparison though. First, his contract wasn’t entirely a UFA deal: it involved a year of RFA time. If you price that year at $2.25MM (the same as Smid is making on his current deal, a two year pact which covers his RFA years, you can sort of back out the price for his UFA years – $3.25MM a year for three years. This leads to the second point.

    “Ah,” you might say, “so you’re saying that the price of $3.25MM a year for Smid is fair. I’d sign that and so should he!” Not exactly. Columbus signed Methot after he’d played basically two years as a top four defenceman. Smid’s into his third. More importantly, Columbus assumed more risk in the deal than the Oilers would signing Smid now. Columbus essentially took the risk that, through injuries or ineffectiveness, Methot’s value on the free agency market would be less than $3.25MM. As you get further away from the point at which a player will be a UFA (this deal was a year away from that), the risk associated with signing a guy that the signing team carries increases and the price should drop.

    There’s another point here, more about leverage than anything else. If I was an NHL player, my financial objective would be to first ensure that I never had to work again in my life and then grab every dollar that I could so as to enlarge the pile of money on which I slept with many beautiful women. That deal for Methot, assuming he manages his money well, was basically his “You never have to work again” deal – $12MM over four years for a guy who, to that point, had made between $2.5MM and $3MM – great career earnings for a guy who’s 25 or so but not quite “No job ever” dough.

    Smid’s probably already north of $8.5MM in career earnings. Again, assuming that he manages his money well, he’s at the point where he doesn’t have to work again. Plus, with 19 games left before he becomes a UFA, his risk of his earning power being dramatically altered by injury or ineffectiveness is pretty small. An offer at, say $3.25MM per year for four years is probably less attractive to him than it would be to someone who hadn’t made that kind of money yet, because even if the slim chance of everything going disastrously wrong comes to pass, he’s set for life.

    Kevin Klein is the other name on that list that jumps out to me as being signed to an outrageously respectable deal. Again, I think it’s noteworthy when the deal was signed: he wasn’t scheduled to become a UFA until the summer of 2013 and Nashville locked him up before the CBA expired. As with Methot, that was his “never have to work again” deal, which will take him from about $5MM in career earnings to $19MM in career earnings, with Nashville carrying the risk that 2012-13 would see him suffer a significant injury or ineffectiveness.

    The other names in my first group don’t seem like good comparables to me. Lydman was 32 and coming off a year in which he was a fifth defenceman in Buffalo – there’s an age related risk discount as well as the fact that he wasn’t coming off a season in which he was a demonstrated top four guy. Emelin played 17:17 in Montreal in his contract year. Mike Weaver was 34 and had never been anything more than a bottom pairing defenceman until 2010-11 in Florida – two years guaranteed at $1.1MM per probably looks pretty good. Florida also did the deal with him on December 30, 2011, taking some of the risk from Weaver that he’d be left without a spot in July, which probably seems more real to you when you’ve had his career.

    Jay Harrison is another guy who’s a bit older and had bounced around various bottom pairings until getting 20 minutes a night with the 2011-12 Carolina Hurricanes. The Canes offered him $4.5MM over three years with a year still to run on his current deal – they assumed the risk of injury or ineffectiveness and he gets the security of a good chunk of money a year before free agency. Scott Hannan is probably a poor comparator simply because of age and because he’s not perceived to be very good anymore.

    The middle group of players has two potential comparators that kind of jump out at you: Johnny Boychuk and Jonathan Ericsson.

    Both recently signed deals at around Smid’s age and both have cap hits that I suspect the Oilers would be happy with for Smid. I did a little digging, looking for news stories when those deals were signed and came up with a few interesting things. Here’s Peter Chiarelli talking about Johnny Boychuk when he was signed :

    “I would think that Johnny, if he had gone to the market, he could have gotten more. “The grass is not always greener, and he probably would have gotten more, and maybe some more terms. He’s still young, though. At the end of this deal, he’ll be 31.”

    I don’t disagree with Chiarelli’s analysis – a second pairing guy on one of the best teams in the league can almost certainly get big money to move up the batting order somewhere else. Ericsson was also a bit of a unique signing because, while he’s moved into Detroit’s top pairing this year, he was a bottom pairing guy for them when they signed him and a bottom pairing guy last year too. His contract isn’t really indicative of what guys who play top four minutes without much offensive ability make.

    At a lower AAV than those two deals, you find Jackman, Salvador and Hejda: three guys in their thirties, the youngest of whom is four years older than Smid will be when he signs his new deal. There’s more miles on those guys and offering them three and four year deals carries greater risk for the teams signing them in terms of age related decay.

    Speaking of age related decay, there’s Nick Schultz in the group above them! Schultz got a very long term deal from the Wild. The number seems great as a possible number for Smid – $3.5MM – but the cap’s up about 13% since then, making it more like a $3.97MM AAV today. Scuderi, who was three years older than Smid will be on July 1, signed a deal that, allowing for increases in the cap, equates to $3.85MM today.

    That leaves Johnny Oduya and Brad Stuart. The Red Wings traded Stuart’s negotiating rights to the Sharks in June of last year, resulting in this story on TSN:

    Stuart had made clear that he wanted to be closer to his family, which still lives in San Jose, and now he gets three weeks to negotiate with the Sharks before possibly becoming a free agent July 1.

    “That’s the goal of making the trade,” Stuart said. “We’ll work on it for the next three weeks and try to work it out. We have some time to figure that out. For the Red Wings to give me time to figure that out shows what a class organization they are. I owe them a lot.”

    So Stuart’s five years older than Smid and wanted to play closer to his family in San Jose. Not really a great comparator, in that he was kind of limiting his own options. Oduya’s probably the closest comparable to this point in terms of his age and the fact that he wasn’t doing something for family reasons, although playing for Chicago has certain rewards of its own that playing in Edmonton doesn’t.

    This leads to the third group:

    Right off the top, you’re going to notice that they’re younger, as Smid is. Only one of these deals was signed by a guy over the age of 30. The only guys in this group who took less than $4MM either got significant term or were over the age of 30 or signed a deal back in 2008, with a cap hit that’s more like $4.25MM today, in Brooks Orpik. The Hainsey deal seems like a bit of an outlier, frankly, but he went all the way to free agency and, presumably, took the highest offer – why else would someone go to Atlanta?

    I don’t propose to get into an argument about where, precisely, Smid fits in but if I combine and redraw these tables to include just players who were younger than thirty when they signed, I get this:

    So, for guys making less than $4MM you have, starting from the bottom: a guy who played 17:17 a night in his contract year, a guy who was offered long term security before the lockout a year before his contract expired, a guy who signed a deal that included an RFA year and was getting long term security in circumstances in which he’d never made big money, a guy coming off a season in which he was a fifth defenceman, a guy whose GM says he took less, two deals that are five years old and a guy who got six years. Those aren’t really compelling grounds on which to make an argument to Smid’s agent that his price tag ought to be less than $4MM over something less than six years when he’s within twenty games of unrestricted free agency.

    What do I think the Oilers should do? Assuming a price of between $4MM and $4.25MM, I think that they should sign him and shoot for a four year term. They’re a rich team and it would make sense for them to front load the deal. If, say, they went $6MM, $4MM, $3MM and $3MM, it permits Smid to serve as a sort of transitional player to the Oilers defencemen who are developing elsewhere at the moment and, barring some catastrophic injury, ensures that they can move him on to someone else if they decide that they no longer need him in Edmonton and probably makes him a more valuable commodity if they were to do so.

    I get that Smid has his flaws as a player but the overriding thing to me is the fact that he is an honest to goodness top four defenceman in the NHL and the Oilers don’t have any sure bets for the next two years in that spot. I am certainly open to arguments that the NHL as a whole fails to properly value players with Smid’s skills – defencemen who can eat minutes without a lot of puck skill – but I don’t know how you can make much of an argument that guys like him, this close to free agency, tend to get less than $4MM over less than six years. I’m also not particularly confident in the Oilers’ ability to pick out classes of players who are overpriced.

    If the Oilers trade Smid for a draft pick or something, the list of guys who you could reasonably bet to be good top four defencemen on the team next year is as follows: Jeff Petry and Justin Schultz. There’s talk that they’ll add a top quality left handed shooting defenceman but there’s nothing concrete yet. Maybe Oscar Klefbom steps right into the top four and doesn’t miss a beat. The point is, there isn’t a lot of certainty there. Ultimately, if Smid’s price is within the reasonable bounds set by the market, why not let the Oilers’ young defensive prospects earn their ice time, rather than giving it to them, regardless of whether they prove ready?

    Finally, and I just want to underline this: we don’t know precisely what Smid’s bottom line is, although I’d guess it’s around $4MM a year for four years – he seems to like Edmonton, he’s married to a local girl and that seems within the bounds of the market to me. The Oilers have already probably thrown away a potential playoff appearance this year with their failure to add another defenceman in the summer who could play top four minutes as well as a legtimate top nine winger. If Smid ends up going for a prospect or a pick and the hole he leaves in the roster isn’t filled over the summer – frankly, I don’t think planning for a rookie defenceman coming off shoulder surgery to fill his hole is a plan – the people who run the Oilers should be crucified for it. Great hockey players, even ones as young as Taylor Hall, only have so many bites at the apple and it’s a waste if he misses out next year because the Oilers are waiting for Klefbom or someone else to go through what Smid went through at the NHL level.

    Email Tyler Dellow at tyler@mc79hockey.com

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    7 Responses to Payday for Laco

    1. TheOtherJohn
      March 23, 2013 at

      Very nice job!

      Have clue why if $$ is issue with signing Smid the Oilers don’t move N Schultz and replace his no offense 3rd pairings minutes with a guy being paid a salary for no offense 3rd pairing skills.

      Forgot, they would then have to explain the idiocy of the Tom Gilbert trade.

    2. Triumph
      March 23, 2013 at

      One thing that would seem to be a bit of a mitigating factor is that Edmonton is terrible and has been for many years, so that makes it more difficult to value someone like Smid. Plus while the cap is at the same level as it was in 2011, I think it’s more significant that the cap is going down from 70.2M – some teams have been planning for this, and others clearly haven’t. I still think they can get him for 3.5-3.75 for 4 years – could be wrong, could be misreading the market, and all it takes is for one team to think that Smid’s real good to muck that all up, but I think this year’s FA class is much harder to predict than previous years.

      • Samir
        May 31, 2013 at

        Only a Toronto newspaper could ask a qutesion like that. The guy has been in the NHL for years now but is an unknown?Meanwhile we await the “Mikael Tellqvist HOF” article which will roll out in newspapers across the country. Meanwhile, somewhere in a Toronto coffee house two people who are wearing shoes that are too small and don’t fart in public openly wonder why Toronto is despised. And so it goes.

    3. Schitzo
      March 24, 2013 at

      I’d be happy to see Smid signed at $3.8 – $4.0, but the team should insist on a significant term on this deal. My ideal would be five or six years – you don’t want to have to do this all over again in two years.

    4. chartleys
      March 24, 2013 at

      well put man.

    5. Oiler Al
      March 24, 2013 at

      I expect he should take a bit of a hometown discount….. Oilers developed him, his wife is from Edm., etc. The above panels are an accurate comp., but there are several players avg. 20 pts per yr, where Smid avg about 10 pts.. not a big deal in the scheme of things.

      There is also the question of Nick Shcultz @$3.5, and where his future is with the team?

      I would suggest Smids, gets 4 years = $15.000 million. Dice up however.

    6. Pingback: Spectors Hockey | NHL Blog Beat – Monday, March 25, 2013.

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