Western Union (WU) stock surged 5.04% in pre-market trading on Friday, following the release of its better-than-expected third-quarter results and a target price upgrade from RBC. The global money transfer firm's shares climbed to $8.37, reflecting investor optimism about the company's performance and growth prospects.

Western Union reported Q3 profit and revenue that surpassed analysts' estimates, according to data compiled by LSEG. The company's consumer services segment grew by an impressive 49% in the third quarter, bolstered by the acquisition of UK-based foreign exchange retailer Eurochange in April. This expansion of its Travel Money business has been a key driver of growth, offsetting a slowdown in the North America retail business.

Adding to the positive sentiment, RBC raised its target price for Western Union from $9 to $10, signaling confidence in the company's future performance. Despite the recent shift from the S&P MidCap 400 to the S&P SmallCap 600 due to market capitalization changes, Western Union's strong Q3 results and strategic expansion efforts have reignited investor interest. The stock's pre-market surge marks a significant turnaround, as it had been down 23.2% year-to-date prior to this rally.