Steve Cohen and the Mets are going long on futures
In the summer of 2023, there was a collective puzzlement asking, “what are Steve Cohen/Billy Eppler/the Mets thinking??” with regards to their actions at the trade deadline.
Finishing with 101 wins in 2022, and poised to make the playoffs again by most pundits pre-2023 season, it seemed the Mets were at worst a wild card lock.
Then…2023 happened.
Contrary to popular belief at the time, despite being a stones throwing distance from *maybe* kinda sorta clinching the third wild card, the team was not indeed one or two players away from definitely most certainly getting that last Wild Card at the deadline…a disappointing far cry from the expectation of winning the division or at the very least being a definite lock for any Wild Card.
Since their inception in 1962, the New York Mets haven’t been known for “pivoting.” Rather, in spite of the limited success otherwise, they’ve been known to stay the course a lot longer than they should, and maybe hold onto players who have seen better days, give the larger contracts more playing time because well, they were being paid, and prospects were undervalued, underdeveloped and cast aside for the “sure thing” veterans.
When things weren’t going well? Attendance would plummet, ownership would point to large payroll (and to wait for the cash to come off the balance sheet) and essentially blame the low attendance for not pursuing new talent.
Wash. Rinse. Repeat.
When the Mets pivoted and went in a new direction by the trade deadline in 2023, it was the signal of a new era. This wasn’t the “Freddie Coupons” Mets anymore.
No, Cohen and Eppler did the most egregious thing: they decided that “insanity” wasn’t an option. Remember, the definition of insanity means doing the same thing over and over again, and expecting different results.
The new management chose *not* to stay the course, surprising the sports media, fans and even the players themselves.
Remember, Cohen is *not* just a wealthy baseball team owner. He’s a successful hedge fund manager. Applying investment methods to his baseball team and their assets (the players) makes sense.
Holding onto Long-Term Investments
Jeff McNeil. Francisco Lindor. Pete Alonso. Edwin Diaz (who spent the 2023 on the injured list). To name a few. What do they have in common? They had contracts and long-ish careers with the Mets at the deadline that year.
The Mets investors held onto these long-term investments which paid off for Lindor (who had an MVP-type season), McNeil (who seemed to find the swing he lost), Alonso (who looks to gain a big pay day as a free agent), and Diaz had an amazing bounce back year.
Shorting the Blue Chips
Future Hall of Famer Max Scherzer signed as a free agent for the 2022 season. Not to be outdone, another future Hall of Fame pitcher Justin Verlander signed for the 2023 season.
In investment terms, these pitchers who have had long and distinguished careers would be called “blue chip” stocks.
Blue Chips are typically reliable investments. An investor knows what they are going to get.
Yet, the credo “buy low/sell high” didn’t apply with these two pitchers. In fact, Scherzer and Verlander (who started his short but not-so-sweet Mets career on the IL) were traded very low on their stock. They did get a pretty decent return on these investments, however.
The Mets front office also dismissed blue chip manager Buck Showalter, signaling a sort of out with the old, in with the new message they wished to impart.
Going Long on Futures
Scherzer was turned around for Texas Rangers’ highly touted infield prospect Luisangel Acuña. Houston parted with top outfield prospects Drew Gilbert and Ryan Clifford to bring Verlander back for another postseason run in 2023.
The Mets also turned around several other short term investments for futures (such as Tommy Pham for former Diamondbacks prospect Jeremy Rodriguez).
Taking Risks
Buyers. Sellers. Holders. Any position takes a risk in the direction they go or plan to stay. In a bullish market, buyers are seen as having control. In a bear market, investors are seen as cautious.
Sometimes, an investor has to take a risk to get a long-term payoff. You’ve got to speculate to accumulate!
Is there anything more “long-term” like a commitment such as owning a baseball team?
Paying Off In Dividends
The 2024 season was “supposed” to be a transition year. The Mets would be “lucky” to sniff a wild card, let alone make the playoffs.
With this new philosophy they embraced, the 2024 New York Mets made it a Game Six of the NLCS, losing to the eventual World Champs, the Los Angeles Dodgers. This was done without many of the future investments and with the long-term investments playing on the actual team.
The youthful philosophy even infiltrated the managerial seat, with Carlos Mendoza being a Manager of the Year finalist in his first year as Mets skipper.
Yes, the “New *new* Mets” position appears to go long on futures, from revamping the farm system, their manager and a subsequent youth movement to make them contenders for years to come.
Nice work Taryn. Sometimes it’s all a crapshoot and deals that looked good on paper, regardless of dollars, miss the mark. The other side of 30 can be a tenuous time for ball players who often find themselves on the IL. That’s why a 15 year deal for Soto is astonishing. In just five years he’ll be 31. Do the math on his years of decline to see how fast this deal could go south. Hated that they needed to move those two future hall of farmers, but it was the right thing to do.
We'll never know how 2023 would have turned out if the Mets kept Scherzer and Verlander. We do know they went into a tailspin immediately after the trades and then played very well after that. And we know that the Wild Card leaders at the time of the trade deadline did not play well. And 84 wins made the playoffs. Bottom line - it was a defensible decision to sell the old pitchers.
But the question that ultimately matters is: Did they get good value in return?
In my opinion, Luisangel Acuna is a utility man. I don't think that was good value. I like Clifford and Gilbert much more. It will be interesting to see how the Mets handle filling 1B and OF, the two positions Clifford and Gilbert are likely to play. And we also have to consider that Benge and Williams are potential OFers, too.
And a Juan Soto signing makes it that much more difficult for prospects to emerge in the OF.