The Italy attacker, signed in August from Juventus, has been linked with a Serie A return this month as he's battled for minutes so far this season.
But Di Matteo told Goal: "I definitely think he can be a success. He is one of the best Italian players. His only downfall has been injuries.
“He has always had a few injuries in his career. If he can get fully fit and stay continuously fit and play games, he is a great player.
"I can see why Liverpool would sign him. It’s a great move, going to Liverpool – a fantastic iconic club, challenges for the Premier League, for the Champions League.
“But Arne Slot said that he has good competition from the guys ahead of him – Mo Salah, Luis Diaz etc – so it’s not easy to get into the Liverpool team.
“I think he will be an asset for them in the second half of the season. He’s looking better now, he’s played a few games, and he’s a great player if he can stay fit."