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3 bargain blue chips

Thanks to a dramatic rise in the S&P/ASX200 Index (ASX: XJO) (^AXJO) over the past 18 months, many investors are finding it difficult to uncover value in the top stocks on the market.

However, with a long-term perspective, many well-established companies with proven business models look cheap. Whether they’ve suffered a troubled few years for one reason or another or their share prices have merely trended sideways as the market awaited news, here’s three top blue-chip stocks which could easily be added to a savvy long-term investors portfolio at current prices.

With huge returns on equity, global exposure and the higher average wealth of individuals in emerging nations, Cochlear Limited (ASX: COH) is one stock I have added to my lifetime portfolio. In recent years, profits have slipped as the company initiated a massive recall of its C1500 series hearing implant which, in turn, hit its share price. Additionally the introduction of a Chinese competitor spooked the market.

Now it’s selling its more advanced Nucleus 6 device which, in 2013, helped the company achieve record sales of 26,674 devices. Whether you buy the stock for its dividend yield or long term organic growth prospects, now is a great time to buy into this market-leading biotechnology stock.

Australian biotechnology presents fantastic opportunities for our country and companies alike. You only have to look so far as ResMed Inc (ASX: RMD) to understand the potential of Australia’s ability to compress health and technology into a booming industry.

Despite the market for ResMed’s products – which includes a suite of respiratory devices to aid sufferers of conditions such as sleep apnoea – investors have baulked at the thought of slowing top line growth, albeit from a bigger base. ResMed sells products all over the globe including the emerging markets of Asia and South America.

In the US alone, ResMed said approximately 46 million people are likely to suffer from some form of obstructive sleep apnoea (OSA). Currently it is estimated less than 20% of those with OSA have been diagnosed or treated. Keep ResMed on your watchlist and if it trends any lower, long-term investors should seriously consider picking up some shares – I know I will.

MQG RMD COH 5yr 2009
Source: Google Finance

Outside of the biotechnology industry and aside from the ‘big four’ banks, Macquarie Group Ltd (ASX: MQG) has been somewhat of a dark horse. I believe the market underestimated it, and still does.

Despite its 50% climb in the past 12 months, shares still appear cheap. As each of its business divisions capitalise on greater confidence in global markets, profit will soar. Whether it’s more a result of investors seeking out the services of stockbrokers, fund managers, business bankers or M&A specialists; management fees and borrowing will benefit this financial heavyweight.

Like Australia and New Zealand Banking Group (ASX: ANZ), the company continues its expansion into Asia which will diversify earnings and enable it to leverage growth from its domestic operations. According to Morningstar’s analysts’ consensus, earnings and dividends per share are expected to jump more than 40% higher in FY14.

Foolish takeaway

Although past performance is no guarantee of future success, investing with a long-term perspective and following extremely successful business models is a great strategy to put the odds of outperformance in your favour. Each of these companies have well-established businesses with global operations which will benefit from the emerging nations throughout Asia and South America. They also pay strong dividends.

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Motley Fool Contributor Owen Raszkiewicz owns shares in Cochlear.