By Josh Beckerman 

Carl Icahn reported a 9.4% stake in Family Dollar Stores Inc., calling the stock undervalued and saying he plans to agitate for changes.

Mr. Icahn said he plans to seek discussions with the retailer's management to discuss "strategies to enhance shareholder value," potentially including the "exploration of strategic alternatives." The billionaire investor made the statement in a filing Friday with the Securities and Exchange Commission.

A Family Dollar spokeswoman didn't immediately respond to a request for comment. The company's shares, down nearly 7% in 2014, jumped more than 10% in after-hours trading following the news.

Mr. Icahn said he and his affiliates "may also determine to seek shareholder board representation if appropriate."

Family Dollar--which caters to low-income shoppers and has more than 8,100 locations--has struggled amid growing competition from Wal-Mart Stores Inc., which is opening smaller locations, and rival dollar-store chains.

In April, Family Dollar said it would close about 370 underperforming stores and slow the pace of new store growth starting next year. In contrast, rivals Dollar General Corp. and Dollar Tree Inc. are charging ahead with their expansion plans.

Icahn joins other notable asset managers in owning Family Dollar. Nelson Peltz's Trian Fund Management LP possesses a 7.4% stake, according to FactSet, while John Paulson's Paulson & Co. has a 5.7% stake.

Write to Josh Beckerman at josh.beckerman@wsj.com

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