At last check shares of the Chesapeake, Va., company moved up 11% to $125.49.
The New York investment firm is looking to push the discount retailer to take action to boost its share price by improving its Family Dollar chain and pricing strategy, The Wall Street Journal reported, citing sources familiar with the matter.
The Journal estimates that Mantle Ridge's stake represents more than 5% of Dollar Tree's shares outstanding, making it one of the company's top two investors.
Mantle Ridge can start nominating board members when the one-month window to do so opens on Nov. 24. Dollar Tree's entire 11-member board is up for reelection.
Rupesh Parikh and Erica Eiler, analysts at Oppenheimer, on Monday affirmed a perform rating on Dollar Tree with no price target.
"We overall view the announced DLTR actions to date as a positive for the story vs. the status quo, and await more specifics," they said. "Near term, we still see a difficult fundamental backdrop and potentially one more negative earnings revision."
In September, the company said that it planned to add new price points to items across its stores.
“We are a ‘test-and-learn’ organization, which is what we are doing with this new initiative," Chief Executive Michael Witynski said. "We listen to our customers and believe it will make shopping with us an even better experience."
At the end of September Dollar Tree also said it would add $1.05 billion to its share buyback program, bringing the total amount authorized to $2.5 billion.