CEO Jeff Immelt of General Electric Co. (NYSE: GE) has demonstrated his confidence in the industrial conglomerate by investing his entire 2013 cash bonus in GE shares. Immelt picked up almost 105,000 shares Monday, at a cost of more than $2.64 million. This followed a purchase of 40,000 shares last week for about $1 million.

Immelt said in a letter to shareholders:

I am investing right alongside of you. I have invested my entire bonus in GE stock. Like the rest of our leaders, I believe in GE.

This comes in a transitional time for GE. Immelt has been working on unit consolidation, including the ongoing spin off of GE’s consumer finance unit. 24/7 Wall St. recently named GE the best conglomerate for the rest of 2014 for its upside potential and dividend yield near 3.5%. It seemed a more attractive option against the likes of Berkshire Hathaway Inc. (NYSE: BRK-A), 3M Co. (NYSE: MMM) and United Technologies Corp. (NYSE: UTX). We see GE in better shape once it is reclassified as just an industrial conglomerate, and see major acquisitions as unlikely in the near term.

We also pointed out when UBS named GE as one of its top industrial stocks even at record highs in the market. UBS has a price target that is even higher than the consensus estimate, and the firm also likes the solid dividend and strong growth potential, particularly in the second half of this year, when commercial construction is expected to increase.

So Immelt has put his money where his mouth is and made one of the largest insider buys by a chief executive in the past year. Shares were up almost 3% in late morning trading Tuesday, at $25.73 in a 52-week range of $21.11 to $28.09.

Chief executives sometimes spend their own money on company stock as a way to shore up investor confidence. If that is what he has done, then it seems to have worked — at least for the moment.

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