Now 21, the midfielder has managed 22 appearances this season, and saw a full 90 on Sunday for the goalless draw with Liverpool.
But Hughes believes Davies has battled to fulfil the promise he showed when first bursting onto the scene four years ago as a 17 year-old. The youngster would wear the captain's armband two years later at 20 years of age.
Hughes came through the junior and youth system at Everton like Davies, making his first team debut with his hometown club and captaining the Toffees' U23s. The 33 year-old remains a big Everton fan and keeps a close watch on developments at Goodison Park.
And he admits he was hoping for much more from Davies this season - convinced some of the natural edge he displayed as a young player has been forced out of him due to supporters' expectations.
Hughes explained to Tribalfootball.com: "(Davies) was a breath of fresh air. I remember going to Goodison and they were playing Man City. Man City were the best team and he was head and shoulders the best player, scored his first goal.
"I don't know if its just when you come onto the scene, you're playing on adrenaline or whatever, but he was ghosting past players and you look at him now and he just looks like a complete shadow of himself.
"I used to watch him and if he had one or two games not going for him, the fans would get on his back and then you think hang on a minute the hardest part of football is going past players and trying to create things, you don't realise how hard it is, and scoring goals, and he had that in his locker and then fans would get on his back and his confidence went down and he was a bit of a scapegoat and he'd get dropped.
"He's just been a shadow of the player he was when he first came on the scene. He's obviously a tremendous player, he was captain of the England U21's. So I just think they should be careful what they wish for."
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