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There was a great comment in response to my capstone research about how capstone compares to other mining companies. I will try to do a more thorough comparison soon but so far here is what I got using globeinvestor's neat filter tool:

I had to cut out some information because it would take too much space but according to this chart, p/e's for similar revenue generating companies as capstone have p/e's of between 12 and 29.

So it does seem to prove that capstone is quite undervalued.

I do remember the Coffin brothers talking about Eurozinc having a 4 or 5 forward p/e so it may take the market a while to realize the true worth of these juniors who are entering production for the first time.

But let me give you 2 quick examples of great picks that were quite similar to capstone: Silvercorp and Paladin. I've been recommending them and holding shares for many months now. Look at their charts to see what I mean. 

Capstone Mining is a company I was researching all weekend because it seems to be in a very good situation right now.

To give you a quick overview of what the company is about, here is a summary off their website:

Capstone Mining Corp. is an emerging Copper-Silver producer in Mexico.  Our Cozamin Copper-Silver-Zinc Mine is on a fast track to production in Q3/2006. 

Goals for 2006 – Cozamin Copper-Silver-Zinc Mine

• achieve commercial production at 1,000 tpd in Q3/2006
• complete an updated resource estimate to increase resources, throughout capacity and mine life at Cozamin
• complete a feasibility study - COMPLETE

The key here is production; it will begin within months. Here are the key points from their feasibility study:

• The initial planned mill throughput rate will be 350,000 tonnes per year with average grades of 2.16% copper, 76.0 g/t silver and 1.0% zinc.
• Estimated average annual production is 16 million pounds of copper, 700,000 ounces of silver and 4 million pounds of zinc.
• Production is expected to begin early in the third quarter of 2006 based on construction completed to date.
• Resource and reserve data included in the feasibility study are up to December 23, 2005. Since then, Capstone has drilled an additional 25 underground holes, which will be included in an updated resource estimate in 2006.
• The Mala Noche vein system remains open along strike and down dip.

Capstone has 63.6 million shares outstanding. With their share price at $2.47 that gives them a market cap of about $157 million.