Ryan McDonagh’s contract introduces a new risk to the Lightning’s cap sheet

The Lightning re-signed Ryan McDonagh a year early to a risky long-term extension

On July 1st, the Tampa Bay Lightning announced a contract extension for defender Ryan McDonagh that will start next summer and pay him $6.75 million over the next seven seasons. The contract will end in the summer of 2026 and cover McDonagh’s age thirty to age thirty-six seasons. When it starts, it will make him the second highest paid defender on the Lightning after Victor Hedman.

The goal of this article is try to sort through what we know about McDonagh and what we can estimate about his future production to get an idea of how this signing is likely to impact the team. We’ll start by looking at the past performance of the player. We’ll then look at how players typically age to understand what he might become over the next few years. And finally, we’ll use that information to assess the bet the Lightning made.

Past Player Evaluation

McDonagh has been one of the best defenders in the NHL during his career. He’s never gotten serious Norris Trophy consideration but he’s had years where he deserved it. His contract with the Rangers that paid him under five million per year was one of the best value deals in the league.

Proving McDonagh’s worth to this point in his career is not difficult. To start, let’s look at a heat map that shows how he performed in some key metrics. All the data here is via Corsica. Blue is good and orange is bad.

From 2011 through the end of the 2016 season, he was as good as it gets. He scored. He drove play both in terms of shots and expected goals. He was an above average, usually well above average, player on offense and defense every season except for 2013-14 but even then, his offensive impacts outweighed a weaker defensive impact. He was a prototype top defender and the clear best player on the blue line for the New York Rangers.

Over the last two seasons, his numbers have slipped a bit. Two years ago was his first with a below average shot share impact. He still maintained an above average expected goal impact and both numbers were above average again last year. He was still a good player over the last two seasons but we’re starting to see some orange creep into the chart.

Looking at all of those numbers and figuring out how to weigh them individually to come up with a holistic view of a player is difficult. So to help us understand how to synthesize all that information, we can use a Wins Above Replacement (WAR) model. Or in this case, two different WAR models. WAR is a stat that measures how many wins a player gives their team above a replacement level player. A replacement level player is one that could be acquired for little or no cost. In the NHL, think of that as a 13th forward or 7th defender.

The chart below shows McDonagh’s general trend over his career using two different models whose methodologies I believe to be the most sound of the available choices. The first is from Evolving Wild and the second is from Corsica. The two models take different approaches to answering the same question so looking at both is helpful.

In the chart, the bars show the percentile rank on a scale of 0 to 100 with 100 being the best defender in the league and 0 being the worst. The line is a smoothed trend to show the general trajectory of whether the player is improving or declining.

This is where things start to get interesting. Overall, we see two models largely in agreement that McDonagh is a great player. Both have him comfortably in the range of a top pairing defender and frequently as a number one overall defender on a good team. Both models also agree that he should have been in Norris contention during his career although they disagree a bit on which years.

Where we see some divergence is during his most recent season. Evolving Wild’s model suggests that McDonagh continued to perform at a high level just slightly below his peak. Corsica’s model suggests that he had a big drop in performance this year. This isn’t the first time Corsica has detected a drop like this. It also showed a decline in the strike-shortened season of 2012-2013.

Projecting Future Production

The question now becomes what to expect from McDonagh over the length of his new contract. To answer that, we’ll start with the two models above a baseline. Because we have two models that disagree on his performance in his most recent season, we’re going to get two different projections for his future performance.

I’ve made a rough estimation of McDonagh’s future production using the findings of Evolving Wild in their aging curve work. The article doesn’t include a table of the changes in WAR so I’ve eyeballed the chart to get an estimate. That’s generally not good practice but we’re not pretending to have certainty here so it will do for now. I’ve also had to make some adjustments to the aging curve to account for the different scaling in these metrics. But again, we’re only looking to get in the ballpark so a rough version will serve our purposes.

These two tracks show a massive difference in production and that difference is mostly based on how the two different models value McDonagh’s performance last season. In the first scenario, McDonagh declines but becomes a low-end first pairing or high-end second pairing player until the end of the contract. In the second scenario, the contract is a disaster that the Lightning would probably have to terminate via buyout.

If you forced me to pick an outcome over the next seven years, I would probably guess somewhere in the middle of these two projections. I don’t think McDonagh is heading off a cliff in the short term. I suspect Corsica’s model will measure an improvement in his results this year much like it did after the 2012-2013 season, which would push his trend back upward. I also don’t think he’s going to be a candidate to be on the top pair in his mid-30s. A projection that has him playing like a serviceable second pair defender for most of the contract and eventually dropping to the third pair for the last few seasons seems reasonable.

Assessing The Contract

The statistics and models we used above to evaluate McDonagh introduced a degree of uncertainty that is for me, frankly, uncomfortable. The best way to try to identify a player’s market value is to use Matt Cane’s free agent contract projections. McDonagh was scheduled to be an unrestricted free agent next summer.

Cane hadn’t released his projections for next summer yet before McDonagh signed on July 1st but he was kind enough to share them for this article. He had McDonagh projected at five years and $6.3 million. Those numbers are two years less and 450k per year less than the contract McDonagh received.

This is where the decision making gets dicey for me. The stats don’t tell me a clean story. It appears that McDonagh’s numbers have started to decline at age 28 but I’m unclear as to what degree. Cane’s model says that the player’s value will be somewhere in the 6 to 6.5 million range over 5 to 6 years if he becomes a free agent.

In this situation, what would help most to guide the decision is more information. If McDonagh was a free agent this summer, the Lightning would have had no choice but to do the best with the info that they had. But that wasn’t the case. They could have taken another year to be sure about how McDonagh is trending.

Another year of seeing him in the Bolts’ system full time. Another year to see how his statistical profile changes. Another year to figure out if some of the decline we measured this season is the start of a trend or just an anomaly.

Instead, the team signed him immediately and gave up the opportunity to gather more information before making a decision. And not only did they re-sign him, but they re-signed him to an over-market-value contract. They gave over-market term, over-market money, and a full no-trade clause until the final season of the deal.

Looking at the information available, I have a hard time seeing the prudence in that decision. In order for this contract to be a good investment, the Lightning need the best case scenario. They need this season’s dips in some metrics to be a blip and not a trend. They need him to age gracefully into his mid-30s.

A good outcome isn’t impossible here. But I’m not sure why the front office would be so certain in a good outcome that they felt the need to get this deal done a year early instead of taking their time and ensuring they have as much information as possible. This contract likely would have been acceptable to McDonagh any time between now and next July 1st. The only reason to get a deal done now would be if the team felt it represented a savings on what he would cost next summer and I don’t see how that could be the case given the term and money.

Wrap Up

Ryan McDonagh is a great player. He deserves more credit than he has received for his play in New York. The Lightning were right to try to acquire him via trade and they are right to view him as part of their long term plans. The only question is what type of contract he should have received for his upcoming time in Tampa.

This is a situation where I would have chosen to wait to make a decision until I had more information. I’m uncomfortable with the amount of uncertainty I have about the player he is now as opposed to two years ago. And that uncertainty would have been enough for me to wait another year to gain more confidence in which path is the right one.

The Lightning have typically been a patient team when it comes to extensions, using the time available to them before locking players up long term. They broke course from that here. We’ll see if their bet pays dividends.