Samsung shares could rally over 40% to record highs on smartphone rebound and chips, analyst says - CNBC

"We expect strong earnings upside to Samsung Electronics' (SEC) earnings in 3Q20, led by the set device (mobile and TV) division," Kim said in a note.

Overall, Kim expects Samsung to post revenue of 65.2 trillion Korean won ($54.86 billion), up 23% quarter on quarter and 5% year on year.

Meanwhile, he forecasts operating profit to come in at 10.5 trillion Korean won ($8.83 billion), up 29% on the quarter and 35% higher on the year.

Kim said he forecasts that profit for the two business units that house smartphones and TVs will outgrow the component division, which includes semiconductors and displays, for the first time since the second quarter of 2016. .

"It seems Samsung is benefitting from Huawei's woes in Europe and Latam and anti-China sentiment in India," Rana told CNBC by email.

Huawei said on Thursday that it would bring its own operating system, HarmonyOS, to its smartphones next year. ?

Huawei's issues are also benefitting Samsung in other areas too.

Kim said the Verizon deal could result in operating profit of 1.2 trillion Korean won ($1.01 billion) by 2025

Meanwhile, Samsung's semiconductor division, which accounts for about two-thirds of operating profit, should continue to grow in the near-term and in 2021. 

In the third quarter, Rana in his note said that there has been a rush of orders from Huawei and other smartphones makers looking to "benefit from Huawei's woes" for memory chips

CLSA's Rana forecasts non-memory revenue to increase to 30 trillion Korean won ($25.24 billion) by 2022 versus 18 trillion this year with operating profit nearly doubling over this period to 3.8 trillion won ($3.2 billion).