Schering-Plough (NYSE:SGP) shares jumped 5.2% to $16.20 Friday, after the company announced that CEO Fred Hassan had purchased 303,500 shares, or $4.68 million worth of stock. Hassan, who took over as CEO in April, said that the investment "reflects [his] long-term confidence in the company."

That's saying a lot.

Schering-Plough has been sheared, falling from around $60 a share three years ago. Sales of allergy drug Claritin have evaporated, and the pipeline is considered "fair" at best.

And if Hassan -- who led Pharmacia's turnaround into a $60 billion sale to Pfizer (NYSE:PFE) -- is indeed the man for the job, it's a pretty big job. Fool contributor Paul Jaber goes so far as to say that Schering-Plough has the look of a value trap.

Value trap or not, Hassan deserves an "A" for buying the stock. For all the reasons a person could have for selling a stock, there's only one reason to buy -- a belief in the long-term viability of the company (as Hassan stated). As importantly, the purchase is also a sign of leadership.

The company, however, gets a "D" for hyping the event. We haves questioned the information flow from the company, including news of the dividend cut, the recent $1.75 billion debt offering, and the company's discussion of an SEC investigation. Was it really necessary to devote an entire press release to an insider purchase?

After all, you don't see companies issuing press releases advertising insider sales.

Regardless, Hassan's purchase is worthy of applause. Of course, cheering is one thing; investors should take a good look at Zeke Ashton and Paul Jaber's recent commentaries before following Hassan's lead.

Discuss turnaround prospects on the Schering-Plough discussion board -- only at Fool.com. Jeff Hwang can be reached at JHwang@fool.com.