Does Every Team Need a Troy Terry? Quantifying the Value of a ‘Shootout Specialist’

This article is being co-posted on NHLNumbers as well as on my own site, OriginalSixAnalytics.com. Find me @OrgSixAnalytics on twitter.

 Troy Terry. Jonathan Toews. T.J. Oshie. These names are all recognizable in part because of a heroic shootout performance they each have put on for their country. Troy Terry was the most recent, scoring 3 goals in the USA World Junior semi-final win over Russia, and ultimately being the sole scorer in the championship game, winning Team USA a gold medal over Team Canada.

Due to shootouts being the subject of many conversations over the last couple weeks, I found myself wondering: for an NHL team, what exactly is it worth to have a shootout specialist in your line up? Should every team have one? Or is it a ‘nice to have’, merely a secondary consideration when evaluating players?

So – let’s see if we can figure it out.

Quantifying the Value of a ‘Shootout Specialist’

In order to answer this, I have looked at three areas:

  1. Simulated outcomes of two league average teams in the shootout
  2. Simulated outcomes of adding a ‘Shootout Specialist’ to a league average team
  3. Estimating the resulting win probability improvement, and quantifying it in terms of standings points/contract dollar value

In order to answer these questions, I have drawn data about the league average shootout (SO) Sh% and Sv% from the last three full seasons courtesy of Hockey-Reference (2013-14, 2014-15 and 2015-16), summarized below:

  • 31% SO Sh% (% of shot that are goals)
  • 69% SO Sv% (% of shots that are saved, or (1 – 31%))

In the next two sections, I will look at a hypothetical team and their Shootout Win Probability %. Let’s call the team in question ‘Team A’, and for now we will treat both Team A and their opponents as league average.

League Average versus League Average

Given shootouts, like wins, are zero-sum (i.e. same number of wins and losses), the average winning percentage on a league-wide basis will always be 50/50. As such, as a starting point, I have created the table below summarizing the round by round probabilities to reach that 50%.

lg-avg

As you would expect, the probability pretty cleanly comes out to 50% winning probability for Team A. If we define a ‘Round Win’ as when one team scores more goals in that round than their opponent, then we get the following distribution in each round:

  • 21% chance that Team A ‘wins’
  • 57% chance of a ‘draw’
  • 21% chance that the Opponent ‘wins’ the round

Now, naturally this is pretty straightforward, as the overall outcome will inevitably be 50/50. However, if we want to know what happens when we start changing players – and having these probabilities update dynamically – it gets a bit more complicated. To address part (b) – adding a Shootout Specialist to Team A, in the next section – I created a tool that simulates the outcome of a shootout, given a particular Sh% and Sv% for each team/goalie.

After running 1000+ simulations, the probabilities here represent the average outcomes, and I am happy to provide more detail on the actual calculations if anyone is interested.

Adding a ‘Shootout Specialist’ to Team A

Now, looking at ‘regular’ SO shooters – i.e. those who have 10 or more attempts in the sample – I will define a ‘Shootout Specialist’ as the players who are in the 90th percentile of these ‘regulars’. Here are all of the players who meet this level over the past three seasons:

list

I will come back to the specific individuals, but as you can see, this cohort of players will score on roughly 52% of their shootout attempts – an impressive number.

So let’s imagine that Team A decides to go out of its way to sign or trade for a Shootout Specialist – what happens if  we add him to our prior probability table?

specialist

With the simplifying assumption that a team will put their specialist in frequently (i.e. every shootout), you can see that a ‘Shootout Specialist’, or a top 10% shooter in the league will increase his team’s likelihood to win a shootout from 50% to 58%. This increase is a far cry from a guaranteed win, but also not an insignificant jump.

Now what exactly is that worth?

In order to convert this 8% improvement to standings points, and ultimately a contract dollar value, there are a couple more steps. Given 2016-2017 is one of the first seasons where the 3-on-3 is well-understood and teams have clearly formed strategies, let’s use the first half of the 2016-2017 NHL season as our proxy for a ‘typical’ year going forward. This half has shown roughly 4 games going to shootout per team so far – giving us ~8 or so for the year.

value

So assuming teams will typically be in ~8 shootouts over the year, and that a shootout specialist will increase their probability of winning by ~8% (50% to 58%), this illustrative scenario implies a shootout specialist would contribute an additional 0.68 shootout wins per season.

Given a shootout win is worth a single standings point, adding a SO specialist to a league average team is worth approximately 0.68 standings points; or about 1/3 of a win ‘win’ per year. Using @Behindthenet’s win value estimate of $2.80M per win (against the salary cap), this skill set is worth about $950K in contract value.

Going back to our first question, of ‘if every team needs a shootout specialist?’ – I think the answer here is likely ‘no’. On a big picture basis, NHL teams should have higher priorities than finding their own Troy Terry or T.J. Oshie – especially since teams shootouts are only relevant during the regular season. However, I would also say that SO capabilities are an important secondary consideration that teams and agents should still absolutely have in mind when negotiating player contracts.

For anyone who noticed the lesser known names on our list of specialists – like Brandon Pirri and Jacob Josefson – these guys might just be examples of ‘Moneyball’ contracts that New York (previously Florida) and New Jersey keep around in no small part for their shootout capabilities. Although both are RFAs, each team has them signed at low risk, 1-year contracts worth $1.1M for each player (Source: CapFriendly). Putting aside Josefson’s injury issues – assuming these guys contribute almost anything in the typical run of play – at #3 and #4 in the league in Shootout Sh% at 56%, they each are likely paying for their cap space in Shootout goals alone.

Other Considerations

Before closing, I should add a couple last qualifiers to my analysis, above:

  • For teams that are currently well below league average in shootouts, the ‘marginal’ value of a specialist is significantly greater than I have shown above, as their ‘baseline’ starting point is much lower
  • Further, any team who has focused on acquiring one or more Specialists should naturally be playing to their own strengths – potentially employing a more conservative strategy in 3-on-3 OT in order to drag extra games into shootouts (again – creating additional value beyond the average 8 games shown above)

Some areas for analysis that others may want to explore further include the value of other ways a team could go about increasing their shootout win %. What if a team had three specialists? Or what if they found a strong shootout goaltender? While each of these merit much further research, my short answers are that:

  • Adding a goalie will naturally have a dis-proportionately large effect, because he gets to face every shot against. However, given that teams have only one starting goalie (versus 12 forward roster slots), the shootout is less likely to be a goaltending priority
  • If a league average team were to have multiple Shootout Specialists, their win percentage in my analysis above would jump even further. My current estimate is that this would reach 66% with two specialists – meaning 1.3 shootout wins over a season, 1.3 standings point, or an aggregate $1.8M in salary cap value

Conclusion

In conclusion – while being a Shootout Specialist certainly increases the value a player adds to his team, I wouldn’t say it is a characteristic that every team ‘needs’ to have in their roster. That said, the New York Rangers and New Jersey Devils may have made some stealth, intelligent signings between Pirri and Josefson, who are some of the highest-value ‘depth’ Shootout Specialists a team could add. Further, when very high caliber players like T.J. Oshie (or Troy Terry down the road) head into their contract negotiations, I certainly would recommend both teams and agents do some work to understand exactly what they should be paying for this skill.

 

Myth-busters: Disproving the Idea that Stamkos “Left Millions on the Table” to Re-sign in Tampa

This article is being co-posted on Maple Leaf Hot Stove as well as on my own site, OriginalSixAnalytics.com. Find me @OrgSixAnalytics on twitter. Author’s note: for those who noticed – my apologies for the 4+ month gap between articles in this ‘Myth-busters’ series. This piece has been about 80% complete since September, though between my day job and hockey consulting work I have had limited time to write. While Stamkos’ contract negotiation is now very old news, the analysis herein remained meaningful, so I figured I would finish this up and publish regardless.

 As introduced in my article in September on the topic of the Leafs use of analytics, this piece will be the second of my ‘Mythbusters’ series. The point of this series was to write a short set of articles that use data and objective analysis to try to go against the grain on some of the narratives that came out over the summer of 2016.

In this article – my topic will be the (now ice-cold) Steven Stamkos free agency situation. Although I am posting this on Maple Leafs Hot Stove, this ‘myth’ is one that has been spread around the league at large. Rumors of Buffalo or Detroit offering Stamkos an AAV of $10-11M+ had people suggesting Steven left an annual $2M-3M+ ‘on the table’ to stay with Tampa. Stamkos was sometimes quoted as having “taken a big pay cut for the chance at a cup”.

Today, I will argue that – although those teams or Toronto may have given Stamkos ‘headline’ contract offers that are significantly above the $8.5M AAV he ultimately took in Tampa Bay – Steven actually maximized his own income by staying in Tampa. The most important factor here will be estimating the tax impact of Stamkos’ hypothetical contract offers – which we will get into shortly.

Most people give Steven credit for the facts that he is the franchise player in Tampa, he is loyal to his teammates, he is the team captain, and is on a team that has been in two consecutive conference finals – but not many give him credit for actually making just about as much money as possible as well.

So – putting aside Stamkos’ current injury and reflecting back to his time of signing – lets dig in.

Situation Recap

Last spring, I wrote two articles about Steven Stamkos: one estimated Stamkos’ market value, and the second was a long term analysis of the Leafs’ salary cap – to see if they had room for him in their ‘plan’. In these, I argued Stamkos’ was ‘worth’ anywhere from $9.5M to $10.5M of AAV for the maximum possible term, and that the Leafs should attempt to sign him for the $9.5M-$10M range.

As we all know, Stamkos ‘shocked’ everyone by re-signing with Tampa Bay days before reaching free agency (granted – he had had the chance to speak to other teams), at a contract value that had previously been released publicly – $8.5M over 8 years. But did he ‘leave money on the table’?

Adjusting Stamkos’ Contract for Tax Implications

It is easy to discount the impact of taxes – especially when it isn’t your money. Unfortunately, the fact of the matter is that no employed person in North American walks home with their ‘full’ salary in hand – the tax-man has to take his slice first. Depending on the region, someone who ‘makes’ $50K per year may take home $40K, and someone who makes $150K will keep maybe $115K – and the highest brackets are even more impactful when these numbers become millions.

Looking at fully-burdened income tax rates (including both federal and state/provincial), Ontario and Florida are at opposite ends of the spectrum – Ontario’s top tax bracket being ~53% and Florida’s being ~39% (source: http://gavingroup.ca/personal-income-tax-rates-in-nhl-cities/) . In order to illustrate this impact, the chart below shows what each team has to pay (on the y-axis) in order for Stamkos to receive a given amount of take-home pay (on the x-axis).

chart-1

This is bit of a simplified approach, so to clarify some of my assumptions:

  • Only applies the highest tax bracket (rather than each marginal bracket), which usually takes affect after a couple hundred thousand in income
  • Combines all levels of taxes (federal, state/provincial)
  • Excludes minor taxes/fees associated with playing away games in different cities/states
  • Ignores the impact of escrow – which would hit all teams equally as a percentage

What does this chart tell us? Quite simply – for Steven (or any player) to take home the exact same amount of money, Tampa Bay can pay him considerably less than other teams on an AAV basis, and still be ‘matching’ or exceeding the offers on a ‘actual take home pay’ basis. This amounts to a substantial financial competitive advantage for Tampa Bay (or the Florida Panthers), and a distinct disadvantage for high tax region teams like Toronto.

Now, given the public storyline was that Stamkos’ top two choices were Tampa or Toronto, let’s see how this would have made hypothetical offers to Stamkos from Toronto and Tampa Bay look on an ‘actual take home’ pay basis.

tml-v-tbl

As you can see – if TML had offered my proposed $9.5M to Stamkos, Steven would only get to keep ~$4.5M per year. At the $8.5M offer that he ultimately accepted from Tampa, the much superior tax rate allows Stamkos to take home pay of $5.2M, a gap of $700K per season!

For Toronto to have matched Tampa’s $8.5M AAV offer, it would have cost them $11.1M AAV per year on Stamkos, which was undoubtedly outside of the range that Lamoriello, Pridham & Co were willing to accept. Put differently – in order for Tampa to match a hypothetical $9.5M AAV offer from Toronto, they would have only needed to give Stamkos $7.3M.

The table below summarizes how this tallies up over the life of his contract, including the fact that Tampa can give him one more year than any other team:

to-v-tbl-table

And – just to be comprehensive here – thanks to TSN’s helpful after-tax take home pay calculator (http://www.tsn.ca/nhl/stamkos), anyone can see that even if Buffalo or Detroit offered Stamkos $11.0M AAV, they only come out at $40.2M and $41.7M in after tax total contract value, respectively – essentially matching the existing offer that Tampa Bay had already made.

 Conclusion

 Financially speaking, it should now be clear that Steven did not ‘leave money on the table’ to stay in Tampa – in fact, he made just about the maximum possible amount when compared to rumored offers from other teams. Further, I haven’t spent any time in this article looking at the wide range of other factors that could have caused Stamkos to want to re-sign in Tampa, including:

  1. Stanley Cup Competitiveness (near term & medium term)
  2. Steven’s Role & Contribution (as Captain)
  3. Total Financial Compensation
  4. ‘Legacy’ Potential
  5. Geography (proximity to friends and family)

Tampa certainly outperforms Toronto on (a), and (b), above, and we just showed he was actually maximizing his total after-tax compensation (c) by staying in Tampa as well. Sure – Toronto would be close to friends and family, and be an unbelievable ‘legacy’ (should he have helped the team become a contender) – but it is hard to knock a superstar athlete for prioritizing the team he captains, who is a regular Cup-contender, that has also given him the best financial offer. It should be no wonder to us as outsiders that Yzerman succeeded again in a long, drawn out negotiation where his offer was fair – and final.