Is Ian Kennedy on pace to opt out of his contract next winter?

When the Royals signed Ian Kennedy to the largest deal for a pitcher in club history, they gave Kennedy the ability to join the several other Royals players who are set to head into free agency after the 2017 season. Kennedy was given a five-year, $70 million deal with the ability to opt out of his deal after this season.

Here is what the contract looks like:

Another way to think about it is that Kennedy can choose to either opt in to a three-year, $49 million deal - what is left on his deal after this season - or see if he can top that from one of the 29 other clubs in baseball.

2016 was the year of the opt outs as several players received one over the winter (Jason Heyward, David Price, Johnny Cueto, Yoenis Cespedes, Justin Upton, Scott Kazmir, and Wei-Yen Chen). Far more it seemed than at any other winter in the past. Dayton Moore hopped on that train and gave Kennedy one while also coughing up a draft pick to sign him.

This year he’s off to a hot start in his first three starts with a 2.37 ERA and a 3.03 FIP, worth 0.4 fWAR. Last year Kennedy started off even hotter, and after his first three appearances he had a 1.35 ERA and 2.60 FIP. Kennedy did end up slowing down, compiling a 4.45 ERA and 5.63 FIP over his next 15 games before finishing the season strong.

So what has Kennedy done in total in a Royals uniform since the ink on his contract dried?

The home runs have been a problem as he finished among the league “leaders” in HR/9 and home runs allowed. He has sported an above-average strikeout rate and an exactly league-average walk rate. There is a bit of a disconnect between his ERA and FIP, he finished with the 4th largest differential in baseball between the two.

That makes sense as ERA is helped out by team defense and FIP punishes for home runs allowed. Kennedy plays half of his games at a ballpark that punishes hitters for fly balls and he a notorious fly ball hitter. Away from the unfriendly homer confines of Kauffman, Kennedy has fared a bit worse with a 3.96 ERA, 4.89 FIP, and 1.66 HR/9 (63% of his home runs allowed were at away parks).

There is a further divergence between ERA (defense dependent) and FIP (defense independent) when you compare Kennedy to the league average:

ERA- : 83

FIP-: 108

By ERA, he’s 17% better than league average but by FIP he’s 8% worse. Really it comes down to what happens when the opposing hitters bat makes contact with the ball. By DIPS theory the pitcher has no control over such things, but by ERA he is rewarded by the sensational Royals defense behind him.

One notorious thing about Kennedy is the type of contact he allows. In 2015 no pitcher allowed more hard contact than Kennedy and from 2010-2016 only one pitcher in baseball (Hector Santiago) allowed a higher hard contact%. That trend continued last year as Kennedy set a career high in hard contact% and finished second overall in the metric (just behind you guessed it, Hector Santiago).

We know what Kennedy has done so far, but a tougher question is what will he do over the life of the next contract he gets. To gain a better perspective, let’s find similar pitchers to Kennedy through age 32 (Kennedy is currently in his age-32 season), particularly those who performed similarly to Kennedy in the last few seasons. We will look at ages 30-32 as 30+ is generally when players start declining and whichever team signs Kennedy if he opts out will certainly be signing up for the better part of his decline years.

Okay so this was a little harder than I thought it would be because of Kennedy’s weirder profile. It actually coughed up a bunch of relievers as it was tough to find someone who matches his K%, BB%, and all the home runs he’s allowed. There is also an issue with the difference between his ERA and FIP, as filtering a range of either eliminates a lot of pitchers - I had over 1,000 - because they usually converge over longer ranges.

For better or for worse, those are the players that I came up with. From age 33 and onward they averaged a 3.83 ERA and 4.01 FIP. Now be careful here because ERA and FIP isn’t adjusted for the era the pitcher pitches in nor the ballparks either. If we use ERA- and FIP- it looks like this:

So using the Kennedy Similarities (™) you are getting a roughly average pitcher for next 200-300 innings (roughly one and a half or so seasons) and you go from there. Best case scenario you get Chris Capuano who aged just fine (posted 2.7 fWAR, 1.3, and 0.8 seasons the next three years respectively). Worst case scenario I guess is you get Scot Shields. You’ll notice though that none of those guys have a home run rate like Kennedy nor a FIP close to his either. Using those two things more closely alongside K% and BB%, you get a list looking like:

Those players all ended up being not very good from age 33+ except for Ted Lilly who was worth an additional 8.7 fWAR from ages 33-37.

What’s interesting there is Marco Estrada. He’s a guy with a recent history of outperforming his FIP, though he doesn’t have the home run issues of Kennedy. From 2015 to 2017 Estrada actually leads all qualified pitchers in ERA-FIP, two spots ahead of Ian Kennedy. Coming off his age 31 season, Estrada declined Qualifying Offer from the Blue Jays as a bit of a formality and the two sides quickly signed to a two-year, $26 million deal. Kennedy is of course owed basically double that amount and will be two years older than Estrada.

One last thing we can do is use FanGraphs contract estimator to see what kind of contract it conjures up (note that 2017 is the default year and cannot be changed so just pretend it covers 2018-2020):

Using that Kennedy would be worth something like $42.5M over the next three years. You’ll recall he’s owed 3/$49M if he doesn’t opt out, so in that scenario he’ll likely stay unless he thinks he can find someone to pay him something like 4/$56M ($14.5M AAV as suggested above over four years).

I wrote at the time that I disliked the Kennedy deal and I’m still sticking by that opinion. If you recall at the trade deadline, the Royals reportedly couldn’t even give Kennedy away for free. They tried packaging him with Wade Davis but either couldn’t find a suitor that would take him or the deal fell apart due to Davis’ medical questions (he was of course eventually traded that winter to the Cubs for Jorge Soler).

Any team taking on Kennedy is going to hope that he can beat his peripherals in his decline years and that their defense is good enough and ballpark is big enough to keep his ERA down. Even if you feel comfortable about the latter two, it’s hard to think the former is sustainable. The other question is are you willing to bet $50M+ on it?

The market for starting pitchers is going to be okay this winter with Jake Arrieta and Yu Darvish as the headliners, Masahiro Tanaka as a potential piece if he opts out, Alex Cobb and Brett Anderson as value plays, and then a bevy of other decent but not great options. Kennedy falls more in the latter group than the former.