On Monday, the Red Sox and 19-year old Cuban prospect Yoan Moncada agreed to a $31.5M signing bonus that would bring Moncada to Boston. Due to the international signing pools allotted in MLB’s collective bargaining agreement, since the Red Sox had already exceeded their spending pool, they will be forced to pay a 100% tax that will bring Moncada’s cost up to $63M in actuality, a large commitment for a prospect without question. However, even with that huge price tag and with Moncada’s status as a promising, but unproven talent, this has the potential to be an excellent signing by the Red Sox.
The primary reason for that optimism is that Moncada’s deal is a signing bonus, not a contract. The Red Sox will pay Moncada the $31.5M that he is owed, but he will enter the minor league ranks and then go through the six years of team control just like any other prospect. Moncada’s signing bonus will not appear on Boston’s payroll and he’ll only count against the Red Sox’ payroll for league minimum and then whatever he makes in arbitration.
And while $31.5M is certainly a large sum of money, it is coming entirely from the pockets of the Red Sox owners and likely won’t prohibit the team from future signings. Consider it a sunk cost, one that won’t come back to bite the Red Sox even if Moncada busts (other than being a waste of money).
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Plus, if Moncada lives up to his hype, his earnings will far exceed Boston’s $63M commitment. He has been compared to some of the generation’s top second basemen in Robinson Cano and Chase Utley and while it’s obviously unlikely he’ll ever reach that mark given the high failure rate of prospects, the raw talent is certainly there. Moncada doesn’t need to be one of the best players of his generation to be a worthwhile investment for the Red Sox, though.
On average, one win above replacement (WAR) is worth $6M, meaning that Moncada will only need to be worth about 10.5 WAR over the course of his six seasons of team control. That is 1.75 WAR per year, the numbers of a role player or average starter and numbers that Moncada should easily reach if he approaches his ceiling. Once the Red Sox start paying Moncada in arbitration, he’ll have to be a bit better to be worthwhile, but 2-3 WAR per season isn’t out of reach for a young talent like Moncada.
There’s plenty of uncertainty about Moncada’s future, don’t get me wrong. However, don’t let the large price leave a bad taste in your mouth about Moncada and Boston’s spending patterns. If he reaches his ceiling and becomes a legitimate star, this deal will be well worth the cost, but even if he doesn’t it could be a worthwhile investment. As the signing does not count against the luxury tax threshold, the Red Sox are essentially paying up front to land a top talent and we should be extremely excited for Moncada’s future in a Red Sox uniform.