Yep, that's a cap. Capacitors perform very important functions within circuits and must be replaced. Because they resist changes in voltage they are often used in filtering but can have many other uses. Get a replacement and some 60/40 SnPb (Tin/Lead) rosin flux core solder. Use a low wattage iron and solder the new one in. Remember, heat the work and NOT the solder. This way the solder will stick. The joint should be shiny. If the joint is moved while setting, not heated enough, or otherwise contaminated it will be dull/discolored. Don't go overboard with the solder either, use just enough to fill the copper pad on the PCB.

REPLACE IT!!