Why one MLB insider is wrong about the riskiness of Cooper Pratt’s contract extension

In recent years, it has become much more popular for MLB organizations to hand long-term contract extensions to players who either have yet to make their big-league debuts or are in the first few weeks of their major league careers. It's undoubtedly a risk for the organizations themselves as they are generally giving a significant amount of guaranteed money to a player who has yet to prove themselves at the major league level. However, these deals also have the potential to result in a significant amount of surplus value for the organizations, as the contracts these young players agree to are lowered by the fact that they don't have a major league track record to point to.

The Milwaukee Brewers, ever-conscious of their comparatively small budget, have taken advantage of this strategy during the Matt Arnold era, knowing that if these deals work out in their favor, it could result in the organization rostering an All-Star level player for a modest salary. Such is the presumed future reality that Milwaukee faces with star outfielder Jackson Chourio. Chourio, who has yet to officially earn the title of "All-Star," was signed to an 8-year, $82 million contract ahead of his debut back in 2024, and after posting 20 HR/20 SB seasons in each of his first two years in MLB, it appears as if his roughly $10 million average annual salary over the next six seasons will be an absolute steal.

In that regard, these contracts can end up being risky decisions for the players themselves. While Chourio will certainly earn more in the first six years of his career than he otherwise would have if he followed the traditional route of three seasons of the league minimum salary followed by three seasons in the arbitration process, he's missing out on two years (and potentially four if the Brewers exercise the two club options on the end of his deal) of free agent dollars, which would almost certainly have exceeded the value of his deal with the Brewers at that future date. That said, the financial security for a player who has yet to even step foot on a big-league diamond continues to make these deals popular among the league's top prospects.

Milwaukee once again signed a pre-MLB debut player to a long-term contract back in early April of this year, when they agreed to an 8-year, $50.75 million deal with shortstop prospect Cooper Pratt. A 2023 sixth-round draft pick of the Brewers, Pratt finds himself on practically every list of the Top 100 prospects in baseball, suggesting that ahead of him is a long and successful major league career.

However, the fact that he is even farther from his MLB debut than Chourio was certainly makes Pratt's deal slightly more risky, which was echoed by MLB executive turned insider Jim Bowden in a recent article for The Athletic. In a list of the most recent long-term contracts handed to players at the beginning of their MLB careers, Bowden labeled Pratt's deal as "high risk," while others, like the contract Kevin McGonigle of the Detroit Tigers -- which is worth three times as much as Pratt's -- were deemed to be "low risk."

Cooper Pratt's defensive floor makes his contract extension a low-risk signing for the Brewers

There's undoubtedly risk involved in Pratt's contract, just as there is with any long-term deal. However, that risk is baked into Pratt's deal. While players like McGonigle (8-year, $150 million), Colt Emerson of the Seattle Mariners (8-year, $95 million), and Konnor Griffin of the Pittsburgh Pirates (9-year, $140 million), earned significantly larger contracts than the one Pratt agreed to, and for good reason, the Brewers seemingly got a good deal with their top-ranked shortstop prospect, which therefore inevitably lowers the risk.

Pratt's deal comes out to an average annual salary (AAV) of just north of $6.3 million. To be fair, via the traditional salary route, Pratt likely wouldn't make that much until at least his second year of arbitration and more likely his third year, meaning the Brewers are "losing" money for the first four or five years of the deal. However, the value that Pratt will presumably add in the final years of the contract should far outweigh the value lost in the seasons prior.

The dollars per Win Above Replacement ($/WAR) model is by no means perfect, especially considering the discrepancy between the salaries players earn at the beginning of their MLB careers and the ones they earn in free agency. However, it's generally agreed upon that 1 WAR is worth $8-9 million in free agency, meaning if a team wants to sign a 3.0-WAR player, they would have to pay an average of $24-27 million/year on the free agent market.

There are obviously more factors at play, like the fact that shortstops generally garner more money on the free agent market, but let's take a conservative approach and say 1 WAR is worth $8 million. Let's also assume that Pratt would have made a league minimum salary of roughly $800,000 in each of his first three years in MLB, and arbitration salaries of $3 million, $6 million, and $9 million in the next three seasons. For reference, Willy Adames made $4.6 million, $8.7 million, and $12.25 million in his three years of arbitration. Therefore, without a long-term deal, let's round up and say Pratt would have made $19 million in his first six years in MLB. Under the long-term deal, he will make, with an AAV of $6.3 million, roughly $37.8 million.

It's a simplified version of the reality, and Pratt likely debuting halfway through the first year of his contract throws a wrench in the calculation, but let's say, in his final two years of the deal, Pratt has to make up for about $19 million of surplus value to make the contract worth it. That means, accounting for the average of $12.6 million the Brewers will be paying Pratt in the final two years of the contract, the shortstop will have to be worth roughly $31.6 million (Pratt's deal is back-loaded, with his salary increasing towards the end of his deal, but for the purposes of this calculation, we'll just assume he's making $6.3 million each year). Assuming the $/WAR on the free agent market remains consistent in the next five years -- another very conservative estimate -- Pratt would therefore have to be worth a total of just 3.95 WAR in his seventh and eighth seasons in MLB (his age 27 and 28 seasons) to make the deal worth it for the Brewers.

For reference, Caleb Durbin and Isaac Collins were both worth 2.6 fWAR in their rookie campaigns last year. Joey Ortiz, even with his poor offensive season, was still worth 1.4 fWAR due to his strong defensive abilities.

Pratt is an incredibly strong defender and can likely rack up 2 WAR with his defensive abilities alone, assuming he's a league-average hitter. Therefore, him reaching 3.95 WAR over the course of two seasons in the prime of his career is a bet the Brewers should absolutely be willing to take, and one that makes the contract seem far less risky.

There are also two club options on the end of Pratt's deal, each worth $15 million, that are likely to be exercised and could add even more surplus value to the Brewers' side of things. Assuming Pratt's bat develops as the Brewers expect it to and his defensive abilities remain strong, there's no reason to believe that his contract is a "high-risk" deal. In fact, it's more likely that it ends up being a favorable deal for the Brewers.

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