Are these 2 blue-chips a buy?

Investing in blue-chips is a must for long-term investors as it provides the added defensiveness to support some of your riskier, high growth companies. However, as many of you may know, many blue-chips come at a a very large price, and investors should therefore be aware of the price they pay for the defensive qualities they receive.

With the reporting season slowly drawing to an end, now is the best time for investors to focus on rebalancing their portfolios with some fresh stocks. Through updated financial reports, investors can gain new insights into the operations of companies and assess their future growth prospects.

Here are two solid blue-chip companies that I think are an attractive buy for the long term, given the release of their financial reports.

 1. BHP Billiton

Diversified mining giant BHP Billiton Limited (ASX: BHP) released outstanding results last week, lifting full-year net profits by 23% to $13.8 billion, despite tumbling iron ore and copper prices that have crushed many of the smaller players. However, BHP Billiton’s “hot topic” has been the planned demerger of some of its non-core assets, to simplify the structure of its portfolio.

While some may be pessimistic about BHP Billiton’s demergers, I think it will be in the best interest of its shareholders. The simplification of its asset base allows BHP Billiton to focus on its core business such as iron ore and copper, allowing it to achieve efficiency improvements and lower per unit costs, to counteract lower commodity prices.

BHP Billiton’s most recent annual report signals a solid company that has been able to battle through unfavourable commodity prices. Its planned demerger seems to be a positive move, as it provides long-term tailwinds in the form of cost improvements, sweetening future earnings. Trading at a price-to-earnings ratio of 14.16 and offering a tasty fully franked dividend yield of 3.4%, I would definitely consider BHP Billiton for a long-term investment horizon.

2. ResMed

Healthcare giant ResMed Inc. (CHESS) (ASX: RMD) provides a wide range of medical equipment to treat sleep apnea, a condition impacting approximately 20% of the U.S population. In its latest financial report, ResMed reported flat sales and lower earnings before interest and tax for the quarter ending June 2014.

ResMed’s relatively poor performance can be primarily attributed to weaker sales in the North American market, which accounts for the largest chunk of its revenue base.

Despite the weaker than expected performance, I remain quite optimistic with regards to ResMed’s future growth outlook. Our ageing population and rising obesity levels are strong contributors to sleep apnea, which helps to boost diagnosis rates and ultimately demand for ResMed’s products.

Furthermore, ResMed continues to fuel research as it consistently retains 8%-9% of revenues each year to develop new products. In the next few years we are likely to see some innovative products being released by ResMed, further improving its demand position.

ResMed’s balance sheet remains very healthy, allowing it to raise dividends further and possibly restructure its North American division. It’s important not to let short-term struggles blind you’re investing judgement, and I think ResMed is a perfect buy for long-term investments.

A grossed-up yield of 7%... plus double-digit profit growth!

Although these two companies seem to be solid investments for investors looking for some long-term growth and added blue-chip "safety", they're not what you call "bargains" at current prices. However there's one stock that offers growth and dividends at a stunning price, the whole package, and we want you to know about it.

The Motley Fool's top dividend stock for 2014 offers growing sales, accelerating profits and a grossed up dividend yield of 6%! NEWLY UPDATED. Find out the name and code right now -- your copy of "The Motley Fool's Top Dividend Stock for 2014" is FREE. Simply click here!

We're more bullish on this stock than these other two and it could very well the star performer of the year.

Motley Fool contributor Aryan Norozi does not own shares in any of the companies mentioned in this article.

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