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On their first day of public trading, the two companies formerly known as Hewlett-Packard Co. together gained $2.5 billion in value, an early sign the market considers them more valuable apart than together.

Shares of HP Inc. rose 13%, closing at $13.83. HP Enterprise dropped nearly 2%, closing at $14.49. Both companies had been trading as "when issued" securities for approximately two weeks ahead of their official debut.

Most attention ahead of the split had been focused on Hewlett Packard Enterprise, the corporate computing company led by Meg Whitman, which aims to build faster-growing lines of business such as next-generation data center products and security services. But on Monday, HP Inc., the printer-and-PC company led by Dion Weisler, dramatically outperformed its sibling.

HP Inc.'s performance was a clear expression of investor appetite for the consistent cash flow and lower risk of the PC and printer company, said Daniel Ives, an analyst with FBR & Co.

Equity researchers at Credit Suisse Group AG issued an outperform rating for HP Inc., saying it had "multiple levers" it could pull to offset declines in the core PC and printing markets.

Mr. Weisler said in an interview with The Wall Street Journal last week he believed that the company could use its printing technology to compete against other copier vendors and branch into 3-D printing. He noted that his Palo Alto, Calif., company would also be able to channel more money into research and development than the 3.1% of revenue benchmark that the old H-P achieved last year.

"We generate an enormous amount of cash inside the printing and personal systems franchises," said Mr. Weisler. "Those investments weren't always channeled back into these businesses."

Both H-P splinters face headwinds amid slumping demand for personal computers and the move toward cloud computing services delivered over the Internet. But HP Enterprise faces the bigger challenge, according to some analysts.

Credit Suisse was neutral on the stock, saying that cloud computing posed a serious threat to corporate technology sellers.

The market is skeptical that companies that have traditionally sold products that run in corporate data centers will be able to transition to the cloud, Mr. Ives said.

H-P last month shut down a five-year effort to build a public cloud service, saying that it would focus instead on developing computing products that run in customers' own data centers and working with existing cloud vendors to support their offerings.

The new HP Enterprise believes that the majority of corporate spending will continue to go toward systems made for corporate data centers, said Bill Hilf, the company's cloud chief. It can grow its server business by developing next-generation products for those customers, he said.

One day of trading is hardly a conclusive basis to evaluate a strategic bifurcation that was more than a year in the making. But if the split proves successful over the next six to nine months, it could persuade other business technology vendors to contemplate their own spinoffs, Mr. Ives said.

"A lot of tech investors are watching this very carefully," he said.

Write to Robert McMillan at Robert.Mcmillan@wsj.com

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(END) Dow Jones Newswires

November 02, 2015 17:55 ET (22:55 GMT)

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