HP better not together?

Poor HP(s hpq). For the past year, Hewlett-Packard’s slogan under CEO Meg Whitman has been “better together.” Now at least one Wall Street analyst is calling for HP to break itself apart, arguing that the parts are more valuable than the whole and that HP would be better off separating its consumer and enterprise IT businesses.

UBS Analyst Steven Milunovich initiated his coverage on HP with a sell rating and a strong recommendation that it remake itself. He wrote:

HP has made the case it can succeed as both a corporate and consumer computing company. We question whether HP is “better together” and that it might be “smart to be apart,” specifically spinning off printers and PCs. HP lacks the pure enterprise focus of IBM(s ibm) and EMC(s emc) yet will have trouble competing for consumers without strong tablet and phone businesses like Apple(s aapl) and Samsung.

HP CEO Meg Whitman

This is ironic given that one big reason HP’s board tossed former CEO Leo Apotheker last year was that he talked openly of selling off or spinning off the company’s $40 billion PC business.  Up to that point, Apotheker’s predecessor Mark Hurd had argued that keeping the margin-challenged PC business meant that HP got the best possible prices on various components not only for PCs, but for servers as well. It was hard for HP watchers to see how that dynamic had changed in a matter of months.

HP has a big enterprise services business — courtesy of its acquisition of EDS — and big enterprise technology plays in servers, storage, and networking. It also makes PCs and printers for consumers. It’s pretty much dumped the tablet and smart phone business it bought with Palm Computing and open sourced the underlying WebOS, although it will likely make Windows 8 tablets(s msft). That profusion of products, to some, means a lack of focus.

This call comes as HP while trying to sustain its traditional hardware business  is also  building out massive cloud infrastructure with which it hopes to compete with Amazon(s amzn) Web Services and struggles to make its $10.2 billion acquisition of Autonomy,  executed under Apotheker, pay off.

Whether whole or in parts, HP has its work cut out for it.

Feature photo courtesy of Flickr user marianodm