Famed money manager Peter Lynch told us executives can sell their stock for any reason, but typically buy only for one: They think the price is going to go up!

Myron Ullman, the CEO of department store chain J.C. Penney (OTC:JCPN.Q) brought in to clean up the mess left behind by his predecessor, just plunked down $1 million into the retailer's stock the other day, suggesting he's confident it will successfully complete its turnaround. Maybe it was an early Christmas gift for himself, because with the stock at $9.45 in late-day trading yesterday, it means he's already made a cool 5.6% return. Not bad for a one-day trade, though, of course, Ullman's not selling. 

In a filing with the SEC, Ullman reported he purchased 112,000 at an average of $8.95 each, and this wasn't an option grant, either, but rather a purchase made on the open market just like you or I would make. I think we should consider this a clear sign he believes the retailer really is ready to jump higher. 

Ullman's been fairly consistent in his belief that Penney can effect the changes needed to recover its lost glory. Although the retailer is still in the early innings of a long game, the third-quarter earnings report showed there are signs the turnaround is working. Though losses quadrupled, gross margins worsened, and same-store sales were down again, comps were trending stronger as the quarter progressed (with the expectation of a positive come the fourth quarter), store traffic turned positive, and gross profits were also improving sequentially each month.

Ullman's success, whether it's his previous stint at Penney's, at Macy's, or with LVMH Moet Hennessy Louis Vuitton, was in refusing to reinvent the shopping experience such as ex-CEO Ron Johnson tried to do. Plastering an old-line retailer with a tech-age feel was jarringly incongruous to the retailer's once-loyal customers, and upon his return, Ullman took steps to immediately resurrect that comfortable feeling they had come to expect.

Rebuilding Penney's brand while under financial duress will be no easy task, but as the quarterly earnings attest, there are green shoots beneath the frost. Ullman proclaimed earlier this month the comps story was improving, and he's steadfast in his belief they'll be positive next quarter. Although he engaged in a bit of sleight of hand, telling investors the retailer didn't need to raise capital this year the day before Penney's did exactly that, the CEO has been a pretty straightforward cheerleader.

Ullman has now put his money where his mouth is -- $1 million is not chump change -- and if he's willing to eat his own cooking, then perhaps other investors will be pulling up a chair to the table as well.

Peter Lynch also observed, "The person that turns over the most rocks wins the game." I think we're about to see J.C. Penney crawl out from underneath this one.