SpaceX Stock Is All Over the Place. 3 Dividend Stocks to Buy Instead That Will Let You Sleep Well at Night

Since going public on June 12, Space Exploration Technologies Corp. (NASDAQ: SPCX), better known as SpaceX, has experienced roller coaster price action. Going public at an initial public offering (IPO) price of $135 per share, SpaceX zoomed within days to prices topping $225 per share. However, the stock has since pulled back and is now trading at around $180 to $185 per share.

While another near-term rally is possible, so too is a further pullback. Worse yet, unlike other IPO stocks, which typically experience a lockup expiration six months after going public, SpaceX's staggered lockup provisions mean insiders will be able to sell shares as early as later this summer, following SpaceX's first quarterly earnings release.

As SpaceX's float currently represents less than 5% of the outstanding share count, the flood of new shares hitting the market could put serious pressure on the SpaceX stock price. While some may be willing to stomach further volatility, given confidence in the long-term SpaceX bull case, more cautious investors may want to look beyond speculative space stocks.

If you are looking for steadier returns, a stronger choice may be high-quality dividend stocks. Some strong examples of these include Coca-Cola (NYSE: KO), Johnson & Johnson (NYSE: JNJ), and Procter & Gamble (NYSE: PG).

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1. Coca-Cola has a not-so-secret recipe for long-term total returns

There's a good reason Warren Buffett made Coca-Cola one of Berkshire Hathaway's long-term stock holdings, and why his successor Greg Abel has yet to pare down this position. Shares in the beverage company may seem dull and predictable, but this consistency has served as the perfect recipe for long-term total returns.

The key ingredient in this not-so-secret recipe is the company's long dividend growth track record. The company has raised its dividend for 65 consecutive years. This places it well within Dividend King territory. Dividend Kings are stocks with 50 or more years of consecutive dividend growth. Over the past 20 years, dividend growth has averaged around 6.7%.

With investors pricing the stock largely on its dependable, ever-growing dividend, the stock has seen steady price appreciation. Coupling that with the stock's 2.7% forward dividend yield, and you get steady, low volatility returns, making it the perfect bedrock position for a portfolio.

2. Johnson & Johnson: another stalwart among Dividend Kings

Similar to Coca-Cola, Johnson & Johnson is another blue chip stock with Dividend King status. This diversified healthcare company has raised its quarterly cash payouts during each of the last 65 years.

Johnson & Johnson may have a forward yield of only 2.3%, but dividend growth has averaged in the mid-single digits for well over a decade. For long-term investors who choose to reinvest dividends, this modest payout can snowball into a major contributor to total returns over time. Better yet, given the healthcare industry's recession-resistant nature, it's a defensive stock that tends to hold up well during stormier times in the broader market.

Alongside relative stability, Johnson & Johnson may also have strong growth potential. With its pivot toward faster-growing segments of the healthcare sector, including a lofty goal of becoming what CEO Joaquin Duato recently dubbed "the world's leading cancer drug maker," greater earnings, dividend growth, and stock price appreciation could be on the horizon. Investors building a diversified long-term portfolio should consider making this stock a core holding.

3. Procter & Gamble: A safe harbor in troubled waters

With "fear of missing out," or "FOMO," arguably driving much of the bullishness among artificial intelligence stocks, and in turn the broad market, concerns about a possible stock market downturn may not be so far-fetched. To be clear, you shouldn't let short-term fears keep you out of the market.

But if you are looking for a defensive, low-volatility stock to own if today's "good times" turn into a more challenging environment, Procter & Gamble is a strong choice. The company behind Tide soap and Gillette razors, it has 71 consecutive years of dividend growth under its belt. Selling household essentials, a recession-resistant business, its shares hold relatively steady during times when more speculative stocks wobble.

However, even if you initially buy it as a safe harbor during market volatility, you may still want to make it a core holding. Currently yielding nearly 3%, annual dividend growth has averaged around 5% over the past decade. Hence, just like with Coca-Cola and Johnson & Johnson, steady gains from quarterly cash dividends will make up a greater share of total returns over time.

Thomas Niel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.