Activist investor Carl Icahn and affiliates reported a nearly 10% stake in Netflix, noting the movie rental company's shares are undervalued due to its dominant market position and international growth prospects.

In a regulatory filing, cahn reported a 9.98% beneficial stake in the company, including shares underlying call options, and said Netflix "may hold significant strategic value for a variety of significantly larger companies that are engaging in more direct competition with one another due to the evolution of the internet, mobile, and traditional industry."