The Orlando Magic’s cap sheet is muddled and a poor season has depressed the value of some players on their team. They can look to others to see their path.
The Orlando Magic are thinking about their cap sheet a lot as they enter the offseason.
The team is essentially capped out with the fifth-highest payroll in the league. There is little maneuverability to spend money in free agency. Not that there are free agents to begin with.
The thought of a high payroll is one that can create ire in some fans. Yes, teams with higher payrolls and those paying the luxury tax should be the ones contending for the championship. The Magic are plainly not that team.
But Orlando is not in the luxury tax either. And in a summer where there are not many marquee free agents and with the understanding that the Magic are not in a position to make a major free-agent play even if they could, spending up to and slightly over the salary cap is not a bad thing.
The Magic’s plan to improve is clearly about making trades. They are looking to deal someone on their roster or a combination of players on their roster for that one player who could take them over the top.
To do that, of course, Orlando needs to have value on the roster to begin with. And that is something we have pondered here for the last few weeks. How do the Magic measure and extract value from the players on the roster?
The general conclusions we have drawn is that Orlando has played well enough to create some value and pick up wins. But the team’s best players have not clearly demonstrated enough positive value for the team to take that next step. And, more importantly, the team’s young players on rookie contracts have not overperformed so extensively to accurately value them when they hit free agency.
Put more simply, the Magic had a very disappointing 2020 season where most of the team underperformed. It really does not take any crazy numbers to figure that out.
But again, how do we assess value? What should appropriate value look like?
That is what we want to do.
Where the Magic stand
The Orlando Magic are both in a position of some strength and potential and also in a precarious position.
Orlando still has plenty of young players who are playing some of their best basketball in their careers. But the team is also undeniably coming off a season that was a disappointment. The Magic did not advance themselves up the standings.
The team has to carve a path forward. But the Magic probably are not in a position to make wholesale changes unless they plan on sacrificing playoff position.
Whether they should take that gamble or not has consumed the fan base completely. And there really are no wrong answers. The Magic can walk a lot of paths and each path carries potential reward and risk.
The biggest thing for the Magic is to pick a path and walk it fully. Jeff Weltman needs clear and decisive plans and he needs to execute them. And that starts with extracting the most value from players — both now in trades and in the offseason.
That is what we are trying to measure.
As we have examined throughout the month, the Magic are certainly not getting that kind of value. Here is the chart we have been referencing that attempts to find value by using VORP as a function of the salary cap to determine market value (for a fuller explanation, click here to go to Nylon Calculus):
| 2020 VORP | 2020 Market Value | 2020 Salary | Difference | |
|---|---|---|---|---|
| Nikola Vucevic | 3.1 | $27,592,199.58 | $28,000,000 | -$407,800.42 |
| Evan Fournier | 1.6 | $15,482,144.78 | $17,000,000 | -$1,517,855.22 |
| Jonathan Isaac | 1.1 | $11,445,459.85 | $5,806,440 | +$5,639,019.85 |
| Aaron Gordon | 1.0 | $10,638,122.86 | $19,863,636 | -$9,225,513.14 |
| Terrence Ross | 0.8 | $9,023,448.89 | $12,500,000 | -$3,476,551.11 |
| Mohamed Bamba | 0.5 | $6,601,437.93 | $5,697,600 | -$903,837.93 |
| Michael Carter-Williams | 0.5 | $6,601,437.93 | $2,028,594 | +$4,572,843.93 |
| D.J. Augustin | 0.2 | $4,179,426.97 | $7,250,000 | -$3,070,573.03 |
| Markelle Fultz | 0.1 | $3,372,089.99 | $9,745,200 | -$6,373,110.01 |
| Khem Birch | -0.1 | $1,757,416.01 | $3,000,000 | -$1,242,583.99 |
| Al-Farouq Aminu | -0.1 | $1,757,416.01 | $9,258,000 | -$7,500,583.99 |
| James Ennis | -0.3 | $142,742.04 | $1,882,867 | -$1,740,124.96 |
| Gary Clark | -0.1 | $1,757,416.01 | $718,765 | +$1,038,651.01 |
| Wesley Iwundu | -0.2 | $950,079.03 | $1,618,520 | -$668,440.97 |
| 2020 VORP | 2020 Market Value | 2020 Salary | Difference |
The biggest thing to notice is even by this potentially crude measure of market value, the Magic are not getting full value for their players. Most of their players underperformed.
As we have studied, perhaps there are flaws in this formula — mostly because of the way I have applied it, even though using the same formula as a frame of reference does give us a snapshot.
Orlando Magic
But it is also something fairly intuitive too. Jonathan Isaac had a really good year even in limited minutes because of injury and far outproduces his artificially low rookie contract. But not by as much as one would think — again, maybe his injuries slowed that progress.
Nikola Vucevic came on strong to the end of the season and seemed to live up to his contract. HIs front-loaded deal could continue to look better.
Evan Fournier had a career year, but at least by VORP seemed fairly replaceable. Certainly at the salary Fournier is making.
John Hollinger of The Athletic introduced his own calculations to figure out value — turning on-court production into a dollar market value. He has been revealing them in light of the upcoming free agent classes throughout the week.
He measured Fournier out to roughly $13 million. That calculation is worse than even the rudimentary formula we have been using here. It looks more and more like the Magic will not retain Fournier when his contract expires.
Outside of super small contract players like Michael Carter-Williams and Gary Clark, it is hard to say the Magic got a production that met market value.
There are flaws with this formula. But there are a few other metrics that suggest these are not too far off.
But focusing only on the Magic puts things in isolation. It might help to see how value looks and looks differently across the league.
Compared to the Sixers
Let’s start with the Philadelphia 76ers — ranked sixth in the league in payroll.
They clearly have two all-star players in Joel Embiid and Ben Simmons — along with high-priced players in Tobias Harris and Al Horford. Yet they finished sixth in the Eastern Conference, still 10 games ahead of the Magic.
Applying the same formula we used for the Magic — imperfect as it might be, but replicating the process should give us some comparison — here is the 76ers’ table:
| 2020 VORP | 2020 Market Value | 2020 Salary | Difference | |
|---|---|---|---|---|
| Ben Simmons | 2.8 | $25,170,188.62 | $8,113,929 | +$17,056,259.62 |
| Joel Embiid | 2.5 | $22,748,177.66 | $27,504,630 | -$4,756,452.34 |
| Al Horford | 2.2 | $20,326,166.70 | $28,000,000 | -$7,673,833.30 |
| Tobias Harris | 1.8 | $17,096,818.75 | $32,742,000 | -$15,645,181.25 |
| Matisse Thybulle | 0.8 | $9,023,448.89 | $2,582,160 | +$6,441,288.89 |
| Alec Burks | 0.4 | $5,794,100.95 | $2,320,044 | +$3,474,056.95 |
| Kyle O’Quinn | 0.4 | $5,794,100.95 | $2,174,318 | +$3,619,782.95 |
| Furkan Korkmaz | 0.3 | $4,986,763.96 | $1,620,564 | +$3,366,199.96 |
| Shake Milton | 0.2 | $4,179,426.97 | $1,445,697 | +$2,733,729.97 |
| Josh Richardson | 0.1 | $3,372,089.99 | $10,116,576 | -$6,744,486.01 |
| Mike Scott | 0.1 | $3,372,089.99 | $4,767,000 | -$1,394,910.01 |
| Trey Burke | 0.1 | $3,372,089.99 | $2,028,594 | +$1,343,495.99 |
| Raul Neto | 0.0 | $2,564,753.00 | $1,737,145 | +$827,608 |
| Glenn Robinson III | 0.0 | $2,564,753.00 | $1,882,867 | +$681,886 |
| 2020 VORP | 2020 Market Value | 2020 Salary | Difference |
This gets into a lot of the things we have discussed through this series. Star power matters and getting excess value from rookie contracts can be a huge turning point.
Ben Simmons, for instance, is in the final year of his rookie contract. The 76ers have gotten tremendous excess value from him. But his salary bumps up to $29 million next season. Suddenly, what he has given the 76ers has him underperforming to his market value.
Philadelphia 76ers
Even Joel Embiid did not meet his market value this year. But as a star, his value is pretty high and this was an admittedly poor season from him. The Sixers are likely happy with what they got from Embiid.
The simmering tension with Simmons and his limitations have been the story with Philadelphia.
That might explain why the Sixers have hit something of a rut. They are preparing to pay Simmons like a star and he has not quite fully reached that level consistently.
It should be noted too that according to VORP, Nikola Vucevic had a higher market value — and a better season — than Joel Embiid and Ben Simmons. This is where it might be more useful to measure market value over multiple seasons and why this specific formula has some limitations.
The other story was how little value the Sixers got compared to their contracts from both Tobias Harris and Al Horford. Those players proved to be albatrosses weighing the team down and preventing the 76ers from reaching their full potential.
But Philadelphia undoubtedly was a better team than Orlando. The Magic’s chart is full of players who have not lived up to their contracts. While the 76ers have players who are weighing down their books like Harris and Horford, they found a lot of gems in role players and lower-level contracts.
Star power covers a lot of problems. That does not take a genius to figure out.
This is a big piece of the puzzles. A part of the puzzle the Magic have not solved.
Compared to the Wolves
Another example is warranted here too.
Let’s look at the Minnesota Timberwolves, a team below the Orlando Magic in the standings and playing with the seventh-highest payroll in the league in 2020.
| 2020 VORP | 2020 Market Value | 2020 Salary | Difference | |
|---|---|---|---|---|
| Karl-Anthony Towns | 2.9 | $29,269,946.75 | $27,285,000 | +$1,984,946.75 |
| Jordan McLaughlin | 0.3 | $5,327,359.25 | $79,568 | +$5,247,791.25 |
| James Johnson | 0.3 | $5,327,359.25 | $15,349,400 | -$10,022,040.75 |
| Malik Beasley | 0.2 | $4,406,490.50 | $2,731,713 | +$1,674,777.50 |
| D’Angelo Russell | 0.2 | $4,406,490.50 | $27,285,000 | -$22,878,509.50 |
| Juan Hernangomez | 0.1 | $3,485,621.75 | $3,321,029 | +$164,592.75 |
| Naz Reid | 0.0 | $2,564,753.00 | $898,310 | +$1,666,443.00 |
| Jaylen Nowell | -0.1 | $1,643,884.25 | $1,400,000 | +$243,884.25 |
| Josh Okogie | -0.2 | $723,015.50 | $2,530,680 | -$1,807,664.50 |
| Jake Layman | -0.2 | $723,015.50 | $3,581,986 | -$2,858,970.50 |
| Kelan Martin | -0.3 | -$197,853.25 | $79,568 | -$277,421.25 |
| Allen Crabbe | -0.3 | -$197,853.25 | $17,818,456 | -$18,016,309.25 |
| Jarrett Culver | -0.8 | -$4,802,197.00 | $5,813,640 | -$10,615,837.00 |
| 2020 VORP | 2020 Market Value | 2020 Salary | Difference |
Like the Philadelphia 76ers, the Minnesota Timberwolves have a top talent in Karl-Anthony Towns. But his effect on winning is similar to Embiid. this year, at least, it was not as pronounced. Nikola Vucevic rated better in VORP.
But what weighs the Timberwolves down is the dead salary. Players like Allen Crabbe and James Johnson performed so woefully under their contract’s value, that it is impossible to do even simple moves. It is impossible to win and get value when players are simply not giving a team anything.
The only thing Minnesota could do was draft better and find G-League players who could step up. Then again, the Timberwolves spent last season (at least by the deadline), trying to reset their team.
Having big contracts is not a problem. Having big contracts — like the 76ers with Al Horford and Tobias Harris — who do not contribute anything is a huge issue for any team. For now, the Magic do not have players like this. They may have players who underperformed, but they are at least contributing to the team’s potential success.
Minnesota Timberwolves
That left Minnesota in a difficult spot. And the Timberwolves took a big risk with a major trade (a very calculated one) to try to set up their future.
This might well be the Magic’s future if the team struggles this season.
Orlando probably wants to enter the season going for the playoffs. But if there are struggles before the trade deadline, the team may begin to seek more significant changes.
Thus, Minnesota is a good model.
The Timberwolves swinging the Andrew Wiggins-for-D’Angelo Russell swap though proved that just having these bigger salaries can create the flexibility to improve. Wiggins had an overall VORP of 0.8 this season (0.6 with the Minnesota Timberwolves and 0.2 with the Golden State Warriors). His market value of $9.8 million had him playing $17.7 million worse than his contract amount.
But they had the ability to still make this move. And the sample size with Russell with the Timberwolves and playing alongside Towns is so small that it is hard to make any conclusions. For simplicity’s sake, I did not separate traded players’ VORP for these tables, so the actual values might be different for a player like Russell.
This is probably still a roundabout way of saying, players playing better will present more value. Teams that win at a high level will have more value.
Lessons and planning
But the Orlando Magic’s chart should reveal that they do not have much dead weight. They do not have the same problem as the Minnesota Timberwolves.
Aaron Gordon being $9.2 million worse than his market value is the biggest albatross around the team’s neck. But even then, the Magic can point to ways Gordon has helped the team. And they can bank — or sell — his expected bounceback.
Indeed, right now it appears Gordon’s trade market, as Zach Lowe of ESPN describes it, is “murky.” Gordon still has a lot to prove.
Gordon is still 25 years old. And with a front-loaded and declining contract, there is still a chance to extract some value for him. Whether that is the big swing trade that propels the team forward? That is a bigger question.
Everyone talks about the Minnesota Timberwolves acquiring D’Angelo Russell as a coup for them. They cemented a solid core to build around with Karl-Anthony Towns. But they gave up a lot to get him — Andrew Wiggins’ contract, yes, but also a protected 2021 first-round pick.
That is the kind of deal that now puts pressure on the Timberwolves to be good quickly or else they lose a valuable first-round pick to continue improving the team.
That is the kind of gamble the Magic are likely staring down.
They do not have players who underperformed that simply are not helping the team in any way. And this is a good thing. It suggests the Magic can make the kind of moves they need to improve.
But not seeing that improvement or seeing players continue to progress and improve is ultimately what could sink the Magic.
That chart is not a favorable one for the Magic. Orlando is playing well enough to compete, but not well enough to climb into true contention. And staring down that value chart, it looks difficult to see the team extracting the correct market value in a trade.
A step back seems like the only way forward — unless the team makes a big trade for a young prospect and expend draft capital to do so.
The next move for the Magic and how they position these bigger salaries is going to determine a lot of this rebuild project for Jeff Weltman and his team.
Another thing is clear though.
Orlando needs to find a galvanizing star truly to take the leap to the next grouping of teams. But the team needs to continue finding players who can contribute and play if not above their station then at least even with it (or perhaps slightly below, at least in terms of this formula).
Collecting larger salaries is not necessarily hampering this team then. That the Magic hope can eventually be their advantage.
But the bottom line is, the Magic need the players they have to play better and show promise to make the kind of moves that could put the team over the top.