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The Billionaire Activist Is Back At It

|Includes: Family Dollar Stores Inc. (FDO)

Billionaire investor and hedge fund manager, Carl Icahn, has waged his latest campaign. Icahn has been very active of late, taking on some of the market's top companies. His latest campaign included prodding Apple to boost its buybacks and pushing for eBay to spinoff PayPal. He's now active in the retail space.

Icahn has a 10% stake in Family Dollar (NYSE:FDO), and is pushing for sale of the company. The market is betting on Icahn, with shares of Family Dollar up over 10% during the last week.

MKM's McKeever could be valued as high as $83, which is still nearly 25% higher than where it currently trades. Another major activist investor is also a major shareholder, Nelson Peltz. He's owned Family Dollar for a number of years. Its dividend yield is 1.9% and it has increased its dividend payment for 37 straight years. It's the only one of the big 3 dollar store chains to offer a dividend yield.

Buy Family Dollar for upside to $80. That puts Family Dollar in line with peers and assumes that even if Icahn can't get a deal done it can put in place some strategic initiatives that better positions Family Dollar in the industry, including boosting margins.