Contract Projection: Dalton Schultz
Could a difference of valuations across the league provide Houston an opportunity to re-sign their veteran safety blanket?
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Continuing with our contract projection series, next up is veteran tight end Dalton Schultz.
Schultz enters a barren tight end free agent market with a positional value market that is likely to remain stagnant. Schultz played the 2023 season on a 1-year contract worth $6.25 million base value with a maximum value of $9.0 million. Schultz did not earn any of the $2.75 million in available incentives.
One concern with re-signing Schultz is the current void years in place. Schultz’s current contract has four void years, for salary cap purposes, which is set to void on February 19, 2024. Houston would need to complete an extension prior to that date to keep the pro-rated money, totaling $3.375 million, from accelerating into the 2024 league year.
The franchise tag is an unlikely scenario. Schultz was franchise tagged in 2022 with the Dallas Cowboys worth $10.91 million. A second franchise tag would be worth $13.09 million, in 2024, due to the 120% rule on a second franchise tag.
Schultz put together a favorable campaign for the 2023 season, finishing the season with 635 receiving yards on 59 receptions and five touchdowns. Schultz underperformed in the eyes of much of the Houston fan base based on the history of tight end success in the Shannahan style system.
Houston currently has a limited tight end room with young players Brevin Jordan and Teagan Quitoriano still on their rookie contracts. Houston could look to draft a tight end, but history shows the transition for a tight end to the NFL takes time.
Houston could look to re-sign Schultz to a short-term extension to shore up the position group in the immediate future.
Schultz is a quality receiving tight end with sporadic efforts in the blocking game. Reviewing the film there are instances where Schultz merely puts a hand on his chip assignment before releasing on his route. On the other end of the spectrum there is film of Schultz taking of blitzing defenders both at the line of scrimmage and working down field in the run game.
Overall blocking is not a trait Schultz is known for as a tight end, a trait that is sought after by the Houston Texans.
The league will continue to value Schultz in the Top 10-12 group of players at the tight end position. Based on my discussions around the league, Schultz’s value during the 2023 offseason could be a precursor for his value going forward.
Despite that bit of information, Schultz will raise his overall contract value during this upcoming offseason, but the overall value may come in a bit lower than some expectations.
If you are a new subscriber to Cap & Trade, welcome to how I complete my contract projections.
For my projections, I look at the player's statistical performance over the past two seasons and compare those numbers against comparable players. The comparable players’ statistics are generated from each respective player’s previous two seasons before signing their respective contracts.
Dalton Schultz is 27 years of age (turning 28 this summer) and a fourth-round draft selection by the Dallas Cowboys in the 2018 NFL Draft coming out of Standford University.
Schultz fits the prototypical size for a tight end in today’s modern NFL game. Schultz has the size and speed to work as an inline tight end or as a big body boundary wide receiver.
Schultz has exhibited a clean injury history with all minor injuries occurring in the lower half of his body.
The following players were used as comparable players: Evan Engram, David Njoku, Dawson Knox, Hunter Henry, Cole Kmet, and Tyler Higbee.
These players represent a wide range in Average Per Year (APY) contract metrics. Due to a stagnant market at the position, expect Schultz to slot in below Kmet and Henry and above Higbee. Market value in terms of Percentage of the Cap (% of Cap) for Schultz should be around 4.5-5.5%.
Comparable Player Statistics
Below is a table of the comparable players’ snap counts and games players with a comparison to Dalton Schultz. Schultz’s clean health history is in line with the market both in games played and snap count percentage.
Looking at where the players line up at snap, Schultz has worked as an inline tight end at a higher rate than the other players except for Njoku. Schultz and Njoku’s numbers are a clear indication of their offensive scheme, and their similarities.
Schultz has commanded a higher target rate in the passing game compared to the market players, at 22.6%. Despite a lower Yards/Reception average, Schultz has a high yards per route run at 1.5 yards. Yards per route run metric is a better indicator of production for a receiver.
Schultz also has a lower dropped pass rate compared to the market players. Recent memories for Houston fans will recall Schultz’s propensity for dropped passes during the playoffs.
Open % is defined as routes where a defender was 3+ yards away at the arrival of the football. WOpen % is the same but classified as 5+ yards. Separation is not always an indication of the receiver’s route-running ability. Watching the film would help further explain the player’s performance in their route running, however, the information below is a good starting point, and should not be the deciding factor.
I ran a search through my All-22 cut ups for Schultz and had quite a few with Schultz running the classic “bang 8 route”. Here we see Schultz lined up with the DB giving him plenty of cushions, an easy route for Schultz to take advantage of.
Schultz showed his ability in the red zone in 2023 when given the opportunity, able to work with difficult catches.
Schultz can work in the contested catch arena as well in high red zone match coverage.
Early I mentioned that Schultz’s blocking efforts can be haphazard. There are times when the effort is lacking, and then there are times when Schultz goes “maximum effort”.
The first clip shows Schultz with less than expected effort on a potential chip on Brian Burns before exiting for his route. Burns’ speed beats Schultz to his chip spot.
On the other end of the spectrum (no pun intended…iykyk) here we see Schultz’s excellent effort on walling off Burns a few plays later to create a lane for Pierce out of the end zone.
Admittedly this projection was a difficult one to put together. The difficulty here stems from the difference between “player value” and “market value”. Schultz’s market value could very well come in below his overall player value. I will present a significant difference between the Team and Agent offers based on this premise.
I believe Houston will be bearish on Schultz's market value. For this contract projection, we are working under the assumption that the extension has been completed before the February 19 void date. I am utilizing the void years already in place from the previous contract.
Continuing with the same presentation, below I have two contract proposals. The first offer will come from the team side, and the second offer will come from the agent side. Theoretically, the two sides would meet in the middle for a final agreement.
Offer 1 - Team
The Houston Texans are ready to offer Schultz a pay raise over his 2023 one-year contract with a two-year extension worth $17.0 million (up to $19.0 million) with $10.5 million in total guarantees, with an $8.5 million APY. The contract's base value is 3.5% of the projected salary cap, below all the comparable market players.
Schultz would receive a $7.0 million signing bonus with a full salary guarantee for 2024 and a small injury-only guarantee for 2025 worth $1.5 million. The contract offers an additional $2.0 million through performance incentives for playtime, receptions, and receiving yards. One additional void year (2028) was added for salary cap purposes on top of the current void years in place.
Despite the lower APY value, this contract offers a strong year 1 cash flow of $9.5m, a million over the contract APY value. I will add this year 1 cash flow may be even more aggressive than what Houston would be willing to go with.
Offer 2 - Agent
With the agent offer the opposite end of the spectrum is presented. The agent, knowing Nick Caserio, opts to present a similar two-year framework for Schultz to continue playing for Houston. A good agent needs to understand team structure and precedent to create a productive negotiation environment.
The contract extension base value is $25.0 million (up to $27.0 million) over two years with $21.5 million guaranteed, an average per year of $12.5 million. The contract's base value is 5.2% of the projected salary cap, a number more in line with the comparable market players.
Schultz would receive a $10.0 million signing bonus and a full salary guarantee in 2024 and a full guarantee of $3.0 million of the 2025 salary at signing. An additional $5.0 million would be guaranteed for injury. The agent matches the per-game roster bonuses and performance incentives as what the team presented.
After looking at all the numbers, both statistical and contract, my assessment is Schultz would be looking at a one- or two-year contract with an average per year (APY) value of $9.0-$11.25 million range once the dust settles.
The expected rise in the league-set salary cap for 2024 and beyond could benefit Schultz this free agency period compared to 2023. This projection was quite difficult with a potential wide variance.
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