Ted's Analysis

NFL team valuations: Still bubblin’

Happy Friday, friends.  I was pretty interested to see the Deadspin article that ran yesterday and included a full copy of the audited financial statements of the Carolina Panthers.  They presented the last two fiscal years, which ended on March 31 of 2012 and 2011, respectively, and they offer a good look at the financial position of a team that sits right in the middle of the NFL in Forbes’s valuation rankings.

I know that I always have some first-time readers, so I hope that my long-time readers will bear with me as I lay out my bona fides for addressing this topic.  I have bachelors degrees in both finance and accounting, and also an MBA.  I’m presently working on finishing the CPA exam, and I hope/expect to be done with it by the end of May.  Additionally, I’ve been working in corporate accounting and finance for eight years, since I graduated with my first BBA.

I’m not exactly an accounting expert, but anybody would tell you that I’m a pretty solid pro, and among football writers, I’m pretty confident in where I stand as a financial analyst.

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You Got Served: Tying Darrelle Revis to Elvis Dumervil

Happy Thursday, friends.  In the wake of the news that Elvis Dumervil is being asked to take a pay cut, I’ve been thinking about what it might mean in a larger sense for the Broncos’ offseason plans.

I haven’t been buying the idea of the Broncos being in on Darrelle Revis, but with the team’s salary structure as it currently stands, and with the expected cuts of D.J. Williams and Joe Mays looming, I tend to view the Dumervil business as a complementary move to something big.

About five weeks ago, I wrote an article where I talked about the Broncos’ salary structure.  I pointed out that Peyton Manning, Dumervil, Champ Bailey, Ryan Clady, and Von Miller account for $58 million in cap hit, which is now 47% of the Broncos salary cap.  That is the primary reason that I say that the Broncos can’t accommodate another large salary.

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Hypothetically replacing Ryan Clady

Happy Saturday, friends.  I was asked by Doug to consider the question posed in this morning's Lard, under the assumption that Ryan Clady gets signed away by another team for the cost of two first-round picks.  It would take a team with cap room, and which wants an absolute sure thing at the LT position to do it.  Really, given Clady's rotator cuff surgery, it's not exactly a sure thing, but it's close to one.

Let's consider what the Broncos' options would be, given the following parameters:

  • An extra 2013 first-round pick - since it's generic, let's call it the 16th pick.
  • Cap room savings of $9.828 million, since the franchise tag wouldn't be in effect any longer.
  • No left tackle on the roster, not even a reasonable project kind of player.

The Broncos would own two first-round picks, a second, and a third in the first two days of the draft, and they'd have about $17 million in cap space, with $9 million more easily available when/if D.J. Williams and Joe Mays are cut.

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Quick thoughts on the Broncos and Collie, Woodson, and Freeney

Happy Saturday, friends. As per Doug's request from last night, I have some thoughts on the potential matches between the Broncos and new free agents Charles Woodson, Dwight Freeney, and Austin Collie.

All are established veterans, but have enough tarnish at this point that they won't command much contractually - think one-year deals, with little or no guaranteed money.

Collie's issue is concussions, but I'd take a look at him as a fourth WR for the minimum.  I'm sure he has better chemistry with Peyton Manning and knowledge of the route concepts than Matt Willis (who's also an unrestricted free agent) does.

I think there's more potential value to the Broncos with Collie than there is to any other team, and the risk to the team is nil.

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Mailbag: Possible breakout defensive players for 2013

Happy Friday, friends.  I got derailed from writing for yesterday, and while I may be a day late, you won’t catch me a dollar short.  In continuation of Wednesday’s topic, today I want to talk about some young Broncos defenders who may be primed for a big leap in 2013.

The most obvious one is probably Derek Wolfe, who had a very nice rookie season, and who I think is only scratching the surface of his potential.  The first thing you have to understand about Wolfe is that he’s not used as a traditional 4-3 DE; he’s really more of a 3-4 type of player, and the Broncos defense is actually mostly a 3-4 in disguise.  If Elvis Dumervil lined up in a two-point stance, the disguise would be gone.

Wolfe was the primary difference between 2011, when the Broncos usually had to use eight men in the box against the run, and 2012, when they usually managed pretty well with seven.  It’s a major deal for the soundness of a defense when it can afford to keep two deep safeties, and the play of Wolfe, Justin Bannan, and Kevin Vickerson was what allowed it.

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Mailbag: Possible breakout offensive players for 2013

Happy Wednesday, friends.  It’s time for another question from the mailbag.  We solicited your questions, and you’ve been sending them.  If you just now thought of something, hit us up here.  For today, Kaleb Harvey writes:

Every year a few players break out like Zane Beadles and Chris Harris did this year. And also players that take on a bigger than expected role like Tony Carter and Wesley Woodyard. Who are your picks for breakout players for next year?

That’s a good question.  I can see some players on both offense and defense stepping up their games, so I’m actually going to break this into two articles, beginning with offense today, and ending with defense tomorrow.

I think, for starters, that it’s easy to point to Ronnie Hillman as a guy who could make a big leap in his second season.  He was the youngest player in the NFL, and it often showed.  He has a lot of talent, but there’s a good deal of work to do there on both technique and physical ability.

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Mailbag: Should Robert Ayers be cut?

Happy Sunday, friends.  Once again, the mailbag has yielded a good question.  This is one of those parts of the offseason where nothing is really going on, and where we’re really likely to have time to address good questions, so keep ‘em coming.

Today, from our friend Haiku Boy:

I have an ongoing argument with this contrarian frenemy of mine who keeps insisting they should cut Robert Ayers. I know the cap savings would be minimal (roughly one million) but he points to his lackluster statistics, low defensive snap count, and frankly the fact he was picked by McDaniels.

 Is there any way this will happen, and would there be any way to justify the move? This guy is seriously bugging the crap out of me.

No problem, HB.  The price for the answer is one haiku in the comment section.  Whenever a fan talks about getting rid of a player, for whatever reason, the first question that must be asked and answered is, “Can you get somebody better (or at least at a better value) to fill the guy’s role, and where’s he coming from?”

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Broncos-style: Why the Dumervil contract is a good one

Happy Tuesday, friends.  Doug mentioned in this morning’s Lard that he and I had discussed Elvis Dumervil, and his associated costs, and I wanted to amplify my thoughts on him.  His cap number of $12.5 million is pretty high for 2013, but since his $12 million salary is fully guaranteed, there should be no doubt that he’ll be a Bronco.

The question is whether he’s properly valued.  Not to spoil the surprise, but I think the answer is yes.  Let’s first talk about the contract Dumervil is working under, which is what I’d call a Broncos-style contract.  They’ve been leading the NFL in moving away from the concept of signing bonuses, and instead going to more of a guaranteed base salary concept, like MLB and the NBA do.

That’s smart from a cash management perspective, because much of the cash inflows that the team receives come during the season, from ticket sales, and concessions, and corporate sponsorships.  I don’t know when the networks and DirecTV pay the NFL, but I think it’s a reasonable assumption that it happens during the season, because that’s when they’re getting cash from their advertisers and (in DTV’s case) subscribers.  By paying out a larger salary during the season, the team times its outflows to match when its inflows are highest.

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You Got Served: 2013 Broncos salary cap and free agency primer - Part 2

Happy Tuesday, friends.  As promised, I’m back with Part 2 of my salary cap and free agency primer.  Here’s Part 1, in case you missed it.  If you did, you missed the homework assignment, so read all the way down and catch up.  We’ll wait.

Okay, welcome to the party.  There were a lot of good ideas in the comments yesterday, and today, I’m going to describe what I would do if I ran the Broncos.  The idea isn’t to reflect what they will do, in other words.  It’s intellectually equivalent of my annual Rational Actor Mock Draft, which is months away from being done for 2013.

As you’ll recall from yesterday, the Broncos are now without two starting DTs, a starting and backup MLB, two backup safeties (one a key special teamer), a starting slot WR, a backup WR, a backup CB, and a backup center.  (That’s just the unrestricted free agents.)  We have $15.5 million of cap room to spend, after we allocate $3 million to the 2013 Draft.

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You Got Served: 2013 Broncos salary cap and free agency primer - Part 1

Happy Monday, friends.  We’re on the other side of the Pro Bowl now, with only a who-gives-a-damn Super Bowl left to go.  For today, I decided to start putting together some salary cap and free agency ideas, so we can all start getting our minds around what’s to come.  There’s already a bunch of speculation out there about who the Broncos should sign or trade for, and most of it is silly.

Today, we’re going to be serious, and we’re going to dismiss all of the delusions of grandeur that a lot of fans and reporters have.  A football team has to plan for both the short term, as well as the long term, and the long-term planning that the Broncos face doesn’t allow for the big splash signings that get people excited.

Let’s start by doing some math, and by understanding how the Broncos currently sit structurally within the constraints of the salary cap.  The cap in 2013 is expected to be around $121 million, and the Broncos currently look like they’ll have $18.5 million at the beginning of the NFL year.  It’s easy to think that they can just go out and spend $18.5 million in average annual value on free agents, but it’s not that simple.

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