Activist investor Carl Icahn is widely regarded as an investor who knows what he wants and goes after it. After several high-profile investments in top tech companies in which he put pressure on management to pursue new strategic directions, he's set a new target. This time, Icahn has his sights set on discount retailer Family Dollar Stores (UNKNOWN:FDO.DL).

It may seem like targeting Family Dollar is a curious choice for Icahn, since on the surface it doesn't look like it falls in line with his other investments. After all, Family Dollar is a fairly small retailer that certainly doesn't share much in common with the mammoth technology companies he's invested in recently.

But beneath the surface, Family Dollar does share similar qualities with many other Icahn-worthy companies. It's struggling to perform in an industry with strong fundamental economics. Indeed, Family Dollar just can't seem to get out of its own way, while other dollar stores like Dollar Tree Stores (NASDAQ:DLTR) continue to rack up impressive results.

Add to that the fact that Family Dollar just underwent a management shakeup that could leave it vulnerable. As a result, it's clear that if Icahn is looking for wounded prey, Family Dollar is actually a great choice.

Family Dollar's woes leave it vulnerable
In a slow-growth economy marked by stagnant wages, you'd think the millions of perpetually cash-strapped consumers would create an ideal environment for deep-discount retailers. Others in the industry, like Dollar Tree, are thriving.

Dollar Tree just posted record first-quarter results. Overall, its same-store sales growth, or growth at stores open for at least one year, clocked in at 2%, and it also reported 7% growth in net sales. Meanwhile, its earnings per share rose 13% last quarter. This is resulting in huge amounts of cash, which the company is showering on investors in the form of share buybacks.

Dollar Tree bought back $1 billion of its own stock over the past year and has another $1 billion remaining in its current share-repurchase authorization.

By contrast, Family Dollar can't seem to get anything right. It's simply off to a terrible start to the year, despite a relatively favorable climate for this type of business. Its first-quarter comparable-store sales fell by 2.8%. Making matters worse was an ensuing management shakeup. After its earnings report, Family Dollar announced that its president and chief operating officer would leave the company to "pursue other interests," without offering any specifics beyond that.

The company followed this up with a total dud in the next quarter, as Family Dollar's second-quarter results were even worse. Same-store sales declined 3.8%, and profits fell by 33% year over year.

The time is right
All these problems are exactly why Family Dollar is ripe for the picking. Carl Icahn reported a 9.39% stake in the company and will pursue strategic change as well as board seats, according to The Wall Street Journal. The timing is perfect for Icahn to try to get people he approves of on the company's board of directors. That will then allow him to exert even more pressure on the company to do something drastic, such as pursue a sale to a competitor.

Family Dollar would have a hard time trying to convince shareholders to reject a sale, considering how poorly the stock has performed over the past year. Shares had lost about 14% year to date prior to the news of Icahn's investment.

Rumors have it that Icahn will push Family Dollar to try to sell itself to Dollar General. In response, Family Dollar has adopted a "poison pill" designed to rebuff Icahn. Should the noted investor accumulate 10% of the company, Family Dollar will issue dilutive new shares.

Although Icahn has plenty of critics, he also holds a fairly good track record of getting what he wants, whether immediately or eventually. Family Dollar shares rose 13% on the news of his investment, implying a broad sense of optimism that a turnaround will materialize. Buckle your seat belts, Family Dollar investors: It's going to be an interesting ride.