Players under rookie contracts can be one of a team's most valuable assets. When you land a star-level player in the draft, the value per production ratio is invariably in your favor. Production equals wins and wins have a value.
Our rule of thumb puts that value at about $2.5 million. Well, Anthony Davis is going to get paid about $4.3 million as a rookie for being the top pick in Thursday's draft. To justify that salary, he just needs to be worth at least two wins. Needless to say, he projects to do considerably better than that.
This is tremendously valuable to rebuilding teams. For prime examples, just look at the Chicago Bulls. After drafting Derrick Rose, the Bulls were rewarded with a level of production that made Rose the league's MVP in just his third NBA season, when he earned just $5.5 million.
With Rose in place as a low-cost foundation player, Chicago was able to lock up Luol Deng and Joakim Noah, while going out and signing a premium free agent in Carlos Boozer. Down the line, the costs shoot up, but there is no better way to stock a roster than by starting with a star player on a rookie contract.
With that in mind, let's look at some projected values from last night's draft. The first section takes a look at the lottery. The second section projects the rest of the first round. We're going to see which players project as the best values over the four-year duration of their rookie contracts. I've projected each player's on-court production using my ATH system for projecting rookies.
In a nutshell, the system estimates how well a player's amateur production will translate based on certain athletic factors, such as foul-drawing ability, rebounding, shot-blocking and steals. This method also is used to project a possible aging pattern for each player, based on his age upon entering the league and similarities to past players with similar athletic traits.
Using ATH, I've forecast the WARP (wins above replacement level) totals for the first four NBA seasons for each player in the lottery. Then I've applied the dollars per win rule of thumb to determine the player's value in dollars. (The actual amount I use is between $2.3 and $2.4 million per win.)
Some players project as below replacement level; the financial value of these players is then assumed to be the league minimum. By plugging in estimates of each player's slot-mandated salary, we can measure how much of a value each player promises to have.
THE LOTTERY PICKS
The slam dunk
Anthony Davis (No. 1 pick, New Orleans)
73.9 projected WARP; Net Value of $127.6 million over rookie scale
No one was close to Davis when it came to consideration as the top pick, and no one is close to projected value. He projects to add nearly 74 wins to the Hornets' bottom line the next four years, while costing New Orleans just $17.2 million. Those wins, in an open-market environment with no cap and no max salary, would be worth $128 million. I'd say that's a bargain. If Davis meets expectations, he'll have no trouble landing a max contract when his rookie deal is up.