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At the very least, they need to wait until next year to make the decision. They can get a better read on him with another year under his belt, especially since they went out and brought in some decent talent at WR for him to throw to in Cooper + Gallup. If he doesn’t do well in 2019 then you need to consider going in another direction. If he does do well, you extend him with a big time QB deal.
Taking it one step further, Ezekiel Elliot is threatening to hold out if he isn’t given a new deal by the summer, so he takes priority over Prescott.
The voice of reason appears as always via @supafly . I think you are spot on here. I really don't understand why these teams are looking to "lock up" their quarterbacks so darn fast. Once in a great while you get a Joe Flacco situation, but for the most part you are much more likely to regret the early extension (Derek Carr comes to mind.) The thing is, I've never seen a team unable to retain their franchise quarterback by waiting until the offseason before the contact expires, and even waiting until the contract expires gives plenty of security with franchise tag options. I think quarterbacks have a lot more pressure to sign and stay in their cities, and many of them have a lot emotional ties to the area and are unlikely to move.
Last year I was really critical of the Packers for doing this with Aaron Rodgers (making him the highest paid) when they could have waited AT LEAST one more year, and now the Chiefs are looking to extend Mahomes after year 3 and talking about the first $200M contract. In both cases, they are just giving the quarterback his market value, even though the early nature of the extension SHOULD allow for a discount by simulating an early free agency. The Cowboys are idiotic if they do the same with Prescott here, especially since he isn't a superstar and, as you've alluded to, there's just no reason to when you have another year to evaluate his play with almost zero downside. Would anyone be shocked if this guy just face plants at any time?