"There was probably an underestimation on the company's part and on Leo's part ... about how difficult this transformation would be," Del Prete said. "They haven't been able to effectively communicate their strategy and vision."
"Investor confidence is a very difficult thing," he added. "When it starts to get eroded, it's very difficult for that person to get confidence back."
Beyond Wall Street, the idea also likely stirred up some concerns among HP's customer base, said analyst Ezra Gottheil, senior analyst at Technology Business Research.
"They are the largest PC vendor in the world, the most profitable after Apple," he said. "Talking about spinning that off without any resolution on it was a surprise. How would you as a customer have responded? I believe they are worried. They took a very large installed base and customer base, and they made them wonder."
There's also the question of whether such a move would fully serve as a way for HP to shed its image as a consumer company, according to King.
Much of HP's $40 billion PC business "is pulled through enterprise deals," he said. "If it was spun off, it'd still be intimately connected to other HP sales and customer relationships. There's no way to separate it entirely, especially the part of HP services that deals with client deployment and management. In a way, it would make sense just to keep it, and keep rolling on."
"It may be the lowest-margin business in HP but it's still profitable," he added. "Letting it percolate in the background may be the smarter move."
Moreover, getting rid of its PC division could hurt HP's server business because the company depends on high-volume supply relationships with component makers, IDC's Del Prete said. It's likely to hurt the company's printer business because PCs help to cement good deals with retailers like Best Buy that also sell HP printers.
Overall, it's still likely that Whitman will continue pushing HP to become more of an enterprise company, King said. "That's clearly where the profits are."
The choice of Whitman as CEO is a bit of a mixed bag, according to King.
"One one side, she's a known entity and she's obviously got significant experience in running a multi-billion dollar run rate company at eBay," he said.
However, Whitman has very little in her background that makes her a good match for a company of HP's size, nor does is she "deeply experienced in the enterprise IT space," he said.
Moreover, Whitman made an unsuccessful run for the governorship of California and "has continued to discuss her political ambitions," King said.
Therefore, it's possible that Whitman will provide HP with some "star power" in the CEO's chair while the company board guides the broader strategy and sets about finding a more permanent CEO, according to King.
One first step for HP and Whitman could be to re-evaluate the company's core PC and WebOS businesses and continue developing a strategy around software and the cloud. Another could be to provide a clear statement on the direction of HP without undermining existing businesses.
Apotheker mishandled the WebOS software and hardware business, which was bought from Palm by former CEO Hurd, said Roger Kay, president of Endpoint Technologies Associates. HP has now killed its WebOS tablets and smartphones, leaving only the software element.
The company has said it was looking into retaining WebOS software and licensing it to third parties. If HP wanted WebOS to be a third-party platform, they could've done it some time ago. But very few device makers want to license it, Kay said, adding that it stands little chance against other mobile platforms such as Apple's iOS and Google's Android.
"Nobody wants to license that thing. If they don't build their own hardware and can't license it, they bought Palm for nothing," Kay said.