MPP Christine Elliott scored the nod from the Tory titan, who helped her open her campaign office, along with federal Conservative MPs and seven of her fellow caucus members.
Davis said he knows Elliott and knew her late husband, former federal finance minister Jim Flaherty, very well.
"The thing that I think is so admirable about Christine is not her function as somebody who's a member of the house, it is her understanding of the needs of people with some difficulties," Davis said.
"She's mainly associated with some of those less fortunate than ourselves and that's the kind of person you love to see in public life and you love to see as leader of our party."
In off-the-cuff remarks that were part stand-up comedy, part endorsement, the 85-year-old former premier said Elliott has the "nature, ability and the sensitivity" the party needs in its leader.
"So that's why I'm here," he said. "I'm also here because my wife said, 'If you're not there, you're in trouble.'"
The former premier said he wouldn't "take any shots at the other possible candidates," but later added that he would be surprised if Doug Ford, brother of outgoing Toronto Mayor Rob Ford, entered the race.
Ford has said he is considering throwing his hat into the ring. A "Draft Doug Ford" campaign and accompanying website has been started by an unknown group of people calling themselves a grassroots movement.
"I'd be very surprised if he is," Davis said when asked about the possibility of Ford entering the race. "I'm not going to say anymore because I might say something wrong."
The deadline for registering as a leadership candidate is Jan. 30 at noon.
Elliott said she wishes Ford well if he chooses to throw his hat in the ring, but she is concentrating on her own campaign.
Hudak stepped down in June after the party's second consecutive election loss to the Liberals under his leadership. Many Tory members of the provincial legislature had complained they were not told about the party's election pledge to cut 100,000 public-sector jobs until hours before Hudak announced it in the first week of the campaign.
The promise dominated the headlines for weeks and prompted public-sector unions to launch unprecedented anti-Tory campaigns, including a series of attack ads that saturated TV and radio.
Elliott said the party has been "drifting for some time" and should get back to its basic and progressive values.
"I think people are looking for balanced, mature leadership because they know we have many economic problems in the province of Ontario," she said. "I want to concentrate on solving our economic problems, at the same time having the kind of social compassion that I think people haven't always identified with our party."
Four other candidates have declared their intention to run for the leadership, but today marks the first day they can file their nominations for the May leadership vote. MPPs Vic Fedeli, Monte McNaughton and Lisa MacLeod are vying to lead their party, as is federal Conservative MP Patrick Brown.
Party members will vote by preferential ballot on either May 3 or May 7 and the results will be announced May 9 at the party's leadership convention in Toronto.
Each of the five declared candidates is already out selling $10 memberships to the party, and whichever signs up the most new members stands the best chance of winning the leadership.
This marks Elliott's second attempt to lead the party — she finished third when Hudak won the Tory leadership in 2009. She first entered politics in 2006, winning a byelection in Whitby, east of Toronto, when Flaherty vacated the seat to run federally. It became the first time in Canadian history that a husband and wife represented the same riding at the provincial and federal levels.