Given a free action of a group $G$ on a directed graph $E$ we show that the crossed product of $C^* (E)$, the universal $C^*$-algebra of $E$, by the induced action is strongly Morita equivalent to $C^* (E/G)$. Since every connected graph $E$ may be expressed as the quotient of a tree $T$ by an action of a free group $G$ we may use our results to show that $C^* (E)$ is strongly Morita equivalent to the crossed product $C_0 ( \partial T ) \times G$, where $\partial T$ is a certain zero-dimensional space canonically associated to the tree.
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