Tytus Howard Contract Details
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The details have arrived on Tytus Howard’s three year contract extension worth new money value of $56.0 million ($18.6 million APY). Let’s break it down to see how it compares against the market.
My initial thoughts, upon the initial report leak, was this extension was a nice meet in the middle agreement. Reportedly, the agent from Howard was looking to get this extension completed in excess of $20.0 million APY; potentially looking at Lane Johnson’s $20.18 million APY extension with Philadelphia.
Houston’s initial valuation came in lower (around $17.0 million) to start the negotiations. This is common for the team to come in low with the the player’s side coming in high. What’s the middle between $17.0m and $20.0m…? The calculator says $18.5 million. Again highlighting this was a solid meet in the middle extension.
Houston General Manager Nick Caserio continues his use of short term contract structure with a three year extension with Tytus Howard. Left Tackle Laremy Tunsil also received a three year extension on his market resetting contract.
The short term contract structure provide the team with flexibility, and provide the player the opportunity to revisit the market early. Howard will be a young 31 years of age when this extension expires. Some teams (especially the one about 4 hours north) want to win contract negotiations and will push for long term agreements. Case in point with the Zack Martin hold out.
Nick Caserio is not interested in playing that game. I suspect his view is to keep the team’s flexibility available, maybe bring in the compensatory pick game, and allow the player a prompt return to the market.
Tytus Howard received a 3 year contract worth $56.0 million with a strong $36.002 million fully guaranteed at signing.
Breakdown of the guarantee:
$18.0 million signing bonus
$2.002 million P5 (base) salary for 2023
$14.0 million P5 (base) salary for 2024
$1.8 million of the scheduled $15.5 million for 2025.
Here we see the usual structure deployed by Nick Caserio. Mild signing bonus, 2 year guarantee (+small kicker in exchange for cash flow concession…more on that later), and per game roster bonuses. I am waiting to see if there are any incentives, but my understanding there is none (similar to Laremy Tunsil).
If you read my projection on an Howard extension (read here), I was admittedly too aggressive on my valuation. Honestly I am disappointed in myself because I had an initial valuation squared at $18.5 million APY with $28.0 million guaranteed and $33.0 million guaranteed for injury.
Then I let some agent driven information push my numbers up. That’s on me. Lesson learned…stick with your eval!!!
In the valuation projection I referenced four players as market comparable contracts excluding Lane Johnson. In the below tables I have decided to include Lane Johnson as a top of the market reference point. Jawaan Taylor is being measured as a left tackle contract, reason why his contract is not included.
Data courtesy of OverTheCap.com and let’s get our cap nerd hats out! Warning the 3 year extension compared to the market with longer contracts will throw some comparisons…off.
First glance we see that Howard is the only player with a 3 year extension. Player age is inline with the market as well. Beating our McGlinchey’s free agent contract is also a big win for Howard.
Here we can look at the high level contract metrics. New money APY slots in 3rd among right tackle contracts. Paper value APY (effective value in the table above) also slots in 3rd. Paper value is essentially the total value of the contract.
(reminder that new money is total value minus money scheduled to earn on previous contract)
The guarantee structure is where Howard’s extension really stands out. An aggressive 64% fully guarantee at signing is a job well done by the agent. As noted above, the three year extension at 3 years will drive some metrics in an interesting direction.
Regardless…64% guaranteed at signing is fantastic for Howard.
Ramczyk and O’Neil did come in above Howard on New Guarantee APY ($9.5m vs $7.6m). This is to be expected because Howard’s existing cash was $13.2 million for 2023 prior to the extension.
The last area I wanted to look at was running cash flow. I.E. how quickly will the player receive their money.
Unfortunately we can’t compare 3yr APY % (as coin by my good friend Brad Spielberger) since Howard would be at 100% with a 3 year extension.
Same as the APY metrics, Howard slots in at 3rd on the 3 year cash flow metric. Unfortunately the 2 year cash flow metric Howard falls down to 5th. My read on this detail, is contracts have some give and take…some sort of middle ground agreement. This was a concession point for the player/agent.
Howard conceded on early cash flow in exchange for stronger guarantees and short term contract length. As I've said time and time again…contracts are about meeting in the middle so that both sides benefit. Contracts should not be a tool used to see who can win at contract negotiations.
This is something I have learned to respect Caserio with, regards to player contracts, valuations, and structure. Meat and potatoes, not much flash, short term, and have benefits avail to both sides. (Caserio probably doesn’t eat potatoes even though they are awesome).
Truly meet in the middle. Two sides agreeing on a common ground to execute a deal that benefits both sides. No arguments from me this time.
Caserio has invested heavily in the offensive line with new contracts for Laremy Tunsil, Shaq Mason, and Tytus Howard on top of draft investment in Kenyon Green and Juice Scruggs. Color me excited to see the team build in the trenches.
I should be back out at training camp on Friday (8/4) and hopefully Saturday (8/5). My daughter has her continued black belt (1st Dan) testing on Saturday, so hopefully the timing works out for me for the evening practice.
I will write up my usual notes on observations from practice. Stay locked in and subscribed. This is going to be a fun season!
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