DigiCo Infrastructure REIT (ASX:DGT) SYD1 data center project has the ability to significantly increase earnings and valuation, according to a Tuesday report from The Australian, citing investing and financial firm UBS.

UBS believes that growth at the project is driven by the available capacity, space densification, expansion, new ownership, and government certification.

The firm's analyst Tim Plumbe, sees multiple pathways for earnings and valuation upside as the company de-risks assets, builds development capability, and achieves performance in line with comparable assets.

The firm has a buy rating on the REIT and a price target of AU$5.60.

Shares of DigiCo Infrastructure REIT fell 12% at market close.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)