Nvidia stock has soared to about $1,200 a share — up 287% since the chip designer’s boffo May 2023 earnings report kindled generative AI fever.

With the stock set to drop to about $120 per share Monday — when the company’s 10-for-1 split goes into effect — will its stock price ever return to $1,200?

Here are four reasons that could happen by 2026 — the first is new, and the last three are still valid since my May Forbes post:

One other risk is business leaders’ bipolar attitude towards generative AI.

How so? CEOs host competing fears. They are afraid of being left behind the generative AI boom even as the potential for AI hallucinations could savage their company’s corporate reputations.

This tension could make it difficult for them to implement high payoff generative AI applications, according to my new book, Brain Rush: How to Invest and Compete in the Real World of Generative AI.

Without that, demand for Nvidia’s technology could be difficult to sustain.

Were Nvidia stock — in an optimistic scenario — to keep rising at the 287% annual rate it enjoyed between May 2023 and last Friday, the company’s post-split shares could top $1,200 sometime in 2026, according to my analysis.

Here is a new source of growth to fuel that rise: Governments in Asia, the Middle East, Europe and the Americas are buying GPUs en masse as they build domestic computing facilities for artificial intelligence, noted the Journal.

What is driving this spending? The desire by countries to develop sovereign AI by training large language models in their own language with citizens’ data. Underlying this imperative is “a quest for more strategic self-reliance amid rising tensions between the U.S. and China,” the Journal wrote.

Nvidia expects sovereign AI spending to account for $10 billion in 2024 revenue, the company said last month. If demand by countries to build their own generative AI capabilities continues to expand, such spending could help Nvidia to diversify its revenue sources.

Angelo Zino, an analyst at CFRA Research, said this revenue stream could help Nvidia continue to profit from the AI boom. “The question has been, how can they continue this momentum?” he told the Journal. “Sovereign AI is a new lever out there in terms of generating higher revenue.”

In addition to sovereign AI demand for Nvidia chips, other drivers of Nvidia’s growth, about which I wrote in my May Forbes post, include:

Based on my interviews with dozens of business leaders, generative AI in companies is caught in a bipolar battle, Brain Rush noted.

Peer pressure forces CEOs to tell Wall Street how generative AI will transform their business. At the same time, CEOs are terrified the AI chatbots will hallucinate — thus damaging their company's reputation.

This fear is based in reality. For instance, Google’s AI advised people to add glue to pizza. And Air Canada's AI chatbot made up a refund policy for a customer — and a Canadian tribunal forced the airline to issue a real refund based on its AI-invented policy.

This bipolar battle has significant implications for business. Of 200 to 300 generative AI experiments companies are developing, they have rolled out only 10 to 15 internally, and released perhaps one or two to customers and other stakeholders, according to my June 3 interview with Liran Hason, CEO of Aporia, a Manhattan-based startup offering guardrails to protect companies from AI hallucinations.

Unless high payoff applications emerge from this process of generative AI experimentation, the wave of demand for Nvidia’s GPUs could taper off over the long run.

In the meantime, business and political leaders’ fear of falling behind in the generative AI race could drive high demand for Nvidia’s chips — and the company’s stock.