They could be a little better than most people are probably giving them credit for, but nowhere near the level of UK. Not even in the same stratosphere.
They have a solid young core in V.J. King (lone starter returning from last year), Jordan Nwora, and Darius Perry.
McMahon isn't very talented but can be a threat from deep when he has room.
Malik Williams is back, along with Dwayne Sutton, decent role players from last year.
They also get UConn transfer big man Steven Enoch. I don't know how good of a player he will be but he's a good kid. I own a business near UofL's campus and he is a customer. Have had a few conversations with him (even in my UK gear).
Outside of those guys there's a pretty significant drop off in talent.
They have a solid foundation to build on, but they are a year or two away at best from being any kind of a major threat. This season I think they will struggle to make the tournament (if they are even eligible).
I suspect their lineup will look like this:
McMahon
Perry
King
Nwora
Enoch
Williams
Akoy Agau (Transfer from SMU)
Sutton