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Luxury retailer Coach began business in 1941 in a Manhattan loft with 6 skilled artisans crafting leather goods.

Hanes began making men's socks in 1901. It went on to make women's socks and when nylon was invented in 1938, Hanes was among the first to make pantyhose. It also branched out to make men's underwear.

What do these two companies have in common?

Hanes was bought by Sara Lee, best known for its baking business which included bread and other baked goods as well as other food and beverage brands such as Hillshire Farm, Jimmy Dean and Ballpark, in 1979.

Coach was initially a family owned business but, strangely enough, it was also bought by Sara Lee in 1985.

Sara Lee is now known as Hillshire Farm and focuses mostly on meat products.

Sara Lee ultimately decided to spin-off both Coach and Hanes into their own separately traded companies so it could focus on its food business. Coach went public in 2001 and Hanes in 2006.

Spin-offs Unlock Value

Over the last 100 years, large U.S. companies would often buy secondary businesses either because it enhanced its current business model or because it didn't know what else to do with its cash.

In 1976, for instance, oil giant Mobil Oil bought department store chain Montgomery Wards in one of the strangest marriages between two companies.

When business divisions are in totally separate industries, there can be calls for a spin-off.

Shareholders and analysts argue that spin-offs of a division can unlock "value" that Wall Street simply isn't recognizing in a company when it is a part of a larger business.

Advantages of a Spin-off

Spin-offs are not the same as new companies going IPO, though they sometimes get lumped into the same category.

Spin-offs usually have a much longer business history, such as Coach's 59 years in business before its IPO, and that can translate into an experienced management team.

Financial data can also be easier to come by because its sales and earnings are usually reported as part of a larger conglomerate.

3 Superstar Stock Spin-Offs to Buy Now

Not all spin-offs move higher out of the gate but these three spin-offs have seen their shares soar since their parent company set them free.

They also have an attractive Zacks Rank and earnings growth.

1. TripAdvisor
2. Fortune Brands Home & Security
3. Fiesta Restaurant Group

1. Tripadvisor, Inc. (TRIP - Analyst Report)

Surprised to see TripAdvisor on a list of spin-offs? It was spun-off from Expedia in Dec 2011.

TripAdvisor is the largest travel web site in the world. It has 260 million unique monthly users.

Forward P/E = 59
2013 Expected Earnings Growth = 1.6%
2014 Expected Earnings Growth = 33%
Zacks Rank #3 (Hold)

TripAdvisor has a good earnings surprise track record since its IPO. It has only missed once.

Shares are up 205% since the IPO.

2. Fortune Brands Home & Security, Inc. (FBHS - Snapshot Report)

Fortune Brands Home & Security displays its pedigree in its name, as it was spun-off from Fortune Brands, Inc. in Sep 2011.

The company sells MasterBrand kitchen cabinets, Moen faucets and Simonton windows as well as security products through the Master Lock brand.

Forward P/E = 27.5
2013 Expected Earnings Growth = 68%
2014 Expected Earnings Growth = 28%
Zacks Rank #2 (Buy)

Fortune Brands Home & Security also has a solid earnings track record, with just one miss since its IPO.

As the real estate market has heated up, and consumers started spending money remodeling their homes again, the company's earnings and revenue has soared.

Shares are up 223% since the IPO.

3. Fiesta Restaurant Group, Inc. (FRGI - Snapshot Report)

Fiesta is the least known of these three companies. It was spun off from Carrols Corporation, which operates 570 Burger King restaurants in 13 states in the Northeast and Mid-Atlantic, in April 2012.

It operates 310 quick-casual restaurant brands Pollo Tropical and Taco Cabana. Pollo Tropical offers tropical and Caribbean inspired food at 100 company owned and 38 franchised restaurants in the U.S., Puerto Rico, the Bahamas, Costa Rica, Ecuador, Honduras, India, Panama, Trinidad & Tobago, Venezuela and the Dominican Republic.

It has been aggressively expanding the Pollo Tropical chain internationally.

Fiesta also operates 164 company owned and 8 franchised Taco Cabana restaurants in the U.S.

Forward P/E = 54.5
2013 Expected Earnings Growth = 29%
2014 Expected Earnings Growth = 26%
Zacks Rank #3 (Hold)

For 2014, it expects to open 20-22 Pollo Tropical and 2-4 Taco Cabana restaurants. It also forecasts 2014 comparable restaurant sales for Pollo Tropical of 3% to 5% and 1.5% to 3.5% at Taco Cabana.

Fiesta also has a solid EPS track record. It has just 1 miss since its IPO.

Shares are up 237% since the IPO.

Spin-offs As Hidden Gems

Spin-offs don't get nearly the love that start-up IPOs get. They don't get their logo hung in a banner on the steps of the New York Stock Exchange.

But spin-offs usually have a longer business track record and, once freed from operating within a larger company, they can finally shine.

Don't neglect the spin-off when looking for that next hidden gem.

[In full disclosure, the author of this article owns shares of TRIP.]

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Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Turnaround Trader and Value Investor services. You can follow her on twitter at @TraceyRyniec.

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