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PartnerRe Ltd. 09 July 2008

Update Report – 1Q 08 Results

Despite industry-wide negatives, PartnerRe looks an attractive prospect

NYSE BUY Direct access tothethe

calculated full
target pricereport free of charge
based on fundamental ata weighted average of target
Fundamental research indicates a 19% upside in the NYSE common stock over the next 6-12 months.
We have factors, using
Common http://www.iirgroup.com/researchoracle/viewreport/show/20260
prices obtained using DCF and comparative valuation methodologies. We continue to take a 6-12
month investment horizon for the stock, as the industry in which the company operates is highly
Stock cyclical and, therefore, trends can be captured more accurately with a shorter investment horizon.
Ticker: PRE
Target price: US$81.76 We upgrade the NYSE common stock from a HOLD to a BUY, with a 6–12 month target price of
Current price: US$68.64 US$81.76.

European BUY The European stock is expected to appreciate approximately 29% over the next 6–12 months as the
19% fundamental upside is augmented by 7 percentage points upside attributable purely to the
Stock1 anticipated appreciation of the US dollar against the euro over our investment horizon and
Ticker: PRE.F approximately 3 percentage points upside attributable to the anticipated reduction in the European
stock discount2.
Target price: €54.02
Current price: €41.97 We upgrade the European stock from a HOLD to a BUY, with a 6–12 month target price of €54.02.

Supervisor: Somnath Banerjee
Analyst: Poonam Jindal
Editor: Heloise Capon
Global Research Director:
Satish Betadpur, CFA
Investment horizon - short term actionable trading strategies
This report addresses the needs of strategic investors with a long term investment horizon of 6-12 months. If this
report is provided to you by your broker under the Global Settlement, you may now also access (free of charge) the
short term trading outlook that we publish from time to time for this issuer, looking at the coming 5-30 days for
readers with a shorter trading horizon. These are available online only at www.researchoracle.com

Next news due: Report summary

2Q 08 results, 28 July 2008
PartnerRe Limited (PartnerRe) reported strong top-line growth in 1Q 08, primarily attributable to growth
in the company’s agriculture business, which benefited from increased opportunities, prices and
demand, and renewal rights to the Monceau Group’s international reinsurance operations, acquired
during FY 2007, leading gross premiums written to increase 10.6% y-o-y during the quarter, in contrast
to the declines reported in the majority of the industry. Net investment income also increased 15.1% y-
o-y in 1Q 08 reflecting an increase in invested assets, higher corporate bond investment rates, and a
stronger euro against the US dollar. However, PartnerRe’s combined ratio increased from 84.8% in 1Q
07 to 92.3% in 1Q 08 due to higher loss and loss expenses. Consequently the company’s adjusted3
net income attributable to shareholders delined y-o-y in 1Q 08. Going forward, we expect softening
rates in Property and Casualty (P&C) products across geographies to adversely impact the company.
Although the company has a well diversified investment portfolio, ongoing volatility in financial markets
is also expected to adversely impact its net investment income going forward. Although we hold a
subdued outlook, partly based on the current significant downturn experienced in the US; we believe
the NYSE common stock currently offers an attractive investment opportunity at current levels.

Currency impact on European stock

By itself, the impact of the anticipated currency movements on the European stock (now €41.97),
without considering changes in the share price, is positive and is expected to be2:

Over 6 months: €39.15

Over 12 months: €43.84

Page 1 Refer to page 5 for footnotes