Investors can still find good dividend stocks in a rising rate environment

Time to sell high dividend-paying stocks?

There are still plenty of dividend-yielding stocks for investors, even in a rising interest rate environment.

Investors do have to pick carefully though, as not every high-yield sector makes sense right now, Josh Duitz of Alpine Funds said on CNBC's "Closing Bell" on Thursday.

"It depends on the sector. Certainly in consumer staples — where you have stocks trading at 20 [price-to-earnings ratios] with low growth — and utilities, I certainly would lighten up in those sectors," Duitz said.

He explained that his firm tends to prefer companies who have dividends that are supported by growing earnings and free cash flow.

Bill Smead of Smead Capital Management agreed, saying it's always a good call to pick companies that can grow their dividend over time. He said on "Closing Bell" that his firm looks for quality companies with good valuations because it likes to own stocks for a long time.

"We can't do anything about what is going to keep something out of favor in the short run, but we know from history that if you buy outstanding companies when they're discounted significantly, you have a tendency to get paid a better dividend," Smead said.